The ethics of administrative credentialing
Article Outline
A vascular surgeon has practiced in the same community for more than 20 years, holding privileges at the two largest local general hospitals. She is widely respected and admired by patients and fellow physicians in all specialties, and her results are consistently good. Recently, the board of directors at the hospital that has been the source of 80% of her case referrals hired a notorious slash-and-burn management firm to improve the balance sheet. The new chief executive officer (CEO) installed an information technology system that can provide management with physician-specific figures on costs and reimbursements. The management consultants identified the 10% of physicians with the worst cost/reimbursement ratios over the preceding 5 years and persuaded the board of directors to order their clinical privileges withdrawn. Our seasoned surgeon learns that she is among the targeted group. Is there an ethical issue here, and, if so, how should she respond?
Hospitals have been adjusting to an intensely competitive marketplace in the decade since withdrawal of cost-plus reimbursements. Hospital administrators are painfully aware that the management model within which they must function is defective and precarious. Third-party payers limit revenue by basing reimbursement on disease categories instead of actual costs incurred by hospitals. Powerful insurers, operating in a seller’s market, negotiate ever-lower payments and then contest charges with delaying tactics1 seldom seen in ethical nonmedical businesses. The complex difficulty of controlling hospital costs just compounds the problem of keeping a positive revenue stream running for a vital community resource.
Physicians, historically independent of hospital business management in virtually all elements of their medical practice, have come to be seen as the hospital’s uncontrolled cost-drivers, a problem administrators have been addressing with increasing aggressiveness. Acting through boards of directors, hospital business managers seek to contain costs and maximize revenues. Certainly all other businesses do so as well, but in the hospital industry, the specter of cost cutting must be monitored by medical staff to ensure no reduction in the quality of medical and surgical care.
The administrative authority to decide which physicians will practice at a given institution would permit hospital managers to retain only the most cost-effective physicians and eliminate those who regularly use more hospital resources in caring for patients than their case reimbursements replace. Economic credentialing—and decredentialing—thus emerges as a powerfully seductive management tool that can imperil a physician’s livelihood and ability to practice medicine without encumbrance.
Economic credentialing assumes heterogeneous efficiency among physicians. Data supporting this assumption are readily available:
Most sophisticated hospitals have been able to generate physician-specific financial data for more than a decade.5 One’s initial reaction might be that a medical business—a hospital—should be entitled to protect itself from wasteful staff physicians. Historically, at least in theory, the criteria for appointment and continuation as a hospital medical staff member have concentrated exclusively on a physician’s conformity with institutional quality-of-care standards. There has seldom before been such a protracted frontal assault upon the concept of medical peer review as the sole arbiter of clinical quality.
Established hospital accreditation bodies have certified that only fully trained and licensed physicians constituting the hospital medical staff—not the hospital’s lay administrators—may suitably evaluate the performance of fellow physicians and thereby govern the credentialing process. We have nevertheless seen the definition of quality in clinical care slowly melt over the last two decades into combined considerations of what constitutes acceptable processes of care, clinical outcomes, and costs.
Clinical quality of surgical care includes mortality and morbidity—clinical outcomes relative to some standard. Clinical outcomes are associated with patient demographics, concurrent disease, and complications. Complications are independently associated with both cost and mortality of surgical care, and patient variability explains only part of the complication rate variances.6
No organization, however beneficently disposed, is obligated to drive itself out of business by persistently incurring more cost than it can replace. In the particular case of a hospital, neglecting its balance sheet to the extent that it cannot survive to provide continuing services to the sick and injured of its community would constitute gross irresponsibility, an ethical outrage in its breach of a critical social contract. Physicians and hospital administrators share a cofiduciary responsibility for the welfare of patients who require the institution’s care,7, 8 and that duty includes making sure that the hospital is financially intact and operational when patients need it.
The other essential responsibility shared by physicians and the institutions they practice in is satisfaction of the public expectation, long fostered by both doctors and hospitals, that medical decisions will be made solely by trained, licensed, and experienced medical professionals and that the sole intent of those decisions will be the provision of the best available care to each individual patient. The most basic of these medical decisions is, of course, the evaluation and selection of physicians properly trained and experienced to take good care of patients in the hospital. Intrusion into this process by laymen—and timid acquiescence by physicians in decisions based solely on economic consideration—deceives a trusting public.
As cofiduciaries, hospitals and the physicians who are privileged to practice in them are obligated to be technically competent in patient care, to use their competence primarily for the benefit of patients, and to systematically place their own self-interest, as organizations and as individuals, secondary to the welfare of their patients. Among its important ethical implications, the concept of cofiduciary responsibility means that hospitals should, as a rule, subordinate their economic self-interest to the well-being of patients, just as physicians should. Economic stability is surely a legitimate interest of hospitals because it is a necessary condition for their having the resources necessary to meet their cofiduciary obligations to their patients. That is, economic stability may be seen as a means to the ethically significant end of fulfilling responsibility, not as an end in itself.
Many hospitals manage costs through their medical staff by using continuous quality improvement (CQI) techniques. Modified from industry for hospital application, CQI employs evidence-based processes of care intended to improve and preserve patients’ health and functional status. Happily, and not coincidentally, most patients treated in this manner not only get over their illnesses quicker, but they routinely cost hospitals the least, with fewer complications, shorter lengths-of-hospital stay, and not many unreimbursed posthospital clinic visits. CQI, properly implemented, doesn’t aim to reduce costs by cutting corners but by recognizing that the faster patients get well, the fewer resources they consume. Using this model, good care can be legitimately equated with inexpensive care without violating cofiduciary responsibility.
The previously cited studies suggest that not all physicians provide the best patient care. Geographic and individual variations in practice styles are sometimes inconsistent with physicians’ fiduciary obligations and those responsibilities they share with the institutions in which they practice. Not only are physicians ethically obligated to participate in institutional CQI activities that have been repeatedly shown to improve the quality of patient care and contribute to the continued stability and viability of their hospitals, they should take the lead in them.
Management decisions that affect patient care and that are made solely on an economic basis violate lay administrators’ cofiduciary responsibility, which requires that the effect of such decisions on patient care must not be left to chance. Physicians are the authorities in patient care determinations, especially in the determination of the medical staff’s composition. The physician leadership should review the economic data objectively and decide whether or not privileges should be withdrawn. Decisions about credentialing by lay administrators based solely on economic considerations systematically put the hospital’s economic self-interest before fiduciary responsibility and undermine the physician’s essential role in CQI, making such decisions completely incompatible with cofiduciary responsibility and, therefore, unethical.
Our embattled surgeon is ethically fully justified in asking her hospital’s chief of staff to convene a medical staff meeting, suggesting that the hospital CEO be invited to attend and explain whether the hospital’s new credentialing policy has been formulated upon evidence-based standards of quality and cofiduciary responsibility or solely on the basis of the hospital’s economic self-interest. If the policy is directed toward improving care, the administration might be firmly reminded that such matters properly and exclusively reside with the medical staff. The medical staff should take the lay administration’s views into consideration as it ponders the question of whether efficient practice is essential to a determination of high-quality practice when it, and it alone, deliberates questions of re-credentialing individual physicians.
If the new policy is not directed toward improving clinical quality as a means of containing costs, but rather toward cost reduction as an end in itself, then it is correctly interpreted to mean that the hospital administration has made financial success its primary goal. In doing so, the hospital administrative leadership has disconnected cost management from cofiduciary responsibility. If so, it cannot consider its medical staff ethically obligated to follow its lead or honor its intent. The medical staff might honorably seek the resignation of an administration that is so clearly an anathema to the basic ethical principles of the medical profession and hospital management.
Option D is not a good first response because it fails to address the ethical issues at the heart of the matter and would probably disintegrate into the surgeon’s sole pursuit of personal interest as she fought to maintain her own privileges. The core issue here is the medical staff’s responsibility for maintaining its informed control of medical care, including those elements of care that may intersect with hospital finance. Physicians properly defend their prerogative in these matters, not in their own interest but as the otherwise unheard voice of their patients. Not only is hospital care determined by lay administrators solely on the basis of economic considerations not medical care, it is also irresponsible management.
Option E must fail in all respects because a national association of physicians can provide support but has no regulatory authority in such matters. As suggested, Option B is an appropriate first step, perhaps best introduced in the context of a medical staff meeting of the sort described. If this option meets with failure, Option C becomes the physician’s ethical responsibility; the major hospital accreditation organizations in the United States support independent medical staff control of its membership. Option A, dissociation from an untrustworthy and dysfunctional organization, becomes the third and last line of moral defense of our surgeon’s professional integrity.
As the practice of medicine evolves in the 21st century, medical staffs must retain leadership in ensuring that the goals of hospital managers and trustees remain focused on improved patient care. This retention of professional power must be deserved by placing guild mentalities and personal finances secondary to professionalism.
References
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- . Lung cancer (a cost and outcome study based on physician practice patterns) . Dis Manag . 2004;7:112–123
- . Cost-effective carotid endarterectomy . Am J Surg . 1995;169:516–518
- . Variation in hospital charges for total joint arthroplasty (an investigation of physician efficiency) . Orthopedics . 2000;23:137–140
- . Economic credentialing survey of university teaching hospitals . Healthc Financ Manage . 1993;47:42; 44–8
- Variations in complication rates and opportunities for improvement in quality of care for patients having abdominal aortic surgery . Langenbecks Arch Surg . 2001;386:249–256
- . A basic concept in the clinical ethics of managed care (physicians and institutions as economically disciplined moral co-fiduciaries of populations of patients) . J Med Philos . 1999;24:77–97
- . Physicians and hospital managers as cofiduciaries of patients (rhetoric or reality?) . J Healthc Manag . 2003;48:172–179 ; discussion, 180
Competition of interest: none.
PII: S0741-5214(04)01523-X
doi:10.1016/j.jvs.2004.11.020
© 2005 The Society for Vascular Surgery. Published by Elsevier Inc. All rights reserved.
