Economists Albert N. Link from the University of North Carolina and John T. Scott from Dartmouth College published their evaluation of 45 Baldrige Award applicants on December 16, 2011. The report is available here (pdf). The Baldrige program asked the 274 organizations that submitted applications from 2007 to 2010 to participate in the study and 45 accepted the invitation. Link and Scott used a counterfactual evaluation method to determine the benefit-to-cost ratio, asking what the private sector would have had to invest to achieve the same level of benefits through the Baldrige program. Benefits were realized in three areas:

• Savings to the applicants in investment costs to achieve the same level of benefits from their performance excellence strategies as they realized from the Baldrige program
• Gains by consumers in greater satisfaction from higher quality products and services
• Gains to the economy from saving scarce resources because the Baldrige Criteria were available

As I understand it, the counterfactual evaluation case made by the study is that organizations that integrate Baldrige increase demand because they offer higher quality products and services and they reduce costs because of more efficient operations. They earn more and spend less.

Link and Scott describe the methodology in their report. They concluded that the ratio of social benefits to social costs among the 45 organizations that responded to the survey was 351:1 while the ratio for all Baldrige Award applicants was 820:1. They also extrapolated these ratios by sector: 456:1 for healthcare, 357:1 for manufacturing, and 119:1 for education. While they cautioned against attaching too much significance to these numbers because of the small sample size for each sector, they emphasized that integrating Baldrige benefits all sectors, arguing that the Baldrige program’s benefits “are not specific to any one sector but reflect benefits realized across all of the sectors.”

In their concluding statement, Link and Scott state: “The Baldrige Performance Excellence Program is a public-private partnership that…creates great value that could not be replicated by private sector actions alone.”

While the public-private partnership equation is changing with the end of federal funding, the value of the program remains the driving force behind those who are working to reinvent Baldrige to continue to bring value to the U.S. economy.

To answer these questions, I’ve launched a new project on Kickstarter to research and write a book called The Road to World-Class Healthcare. You can watch a video introducing the project and read a complete description of it here. The key to the book is the research: road trips to 20 to 25 world-class hospitals and medical centers across the country to interview leaders and learn about best practices.

To fund the research, I’ve posted the project on Kickstarter. A Kickstarter project succeeds by gaining backers who pledge financial support in exchange for rewards. Your reward for becoming a backer of The Road to World-Class Healthcare includes exclusive access to audio excerpts of key interviews, photos, and video of best practices. Invest more and the rewards increase. You can find the complete list of rewards here.

One of the reasons for posting this project on Kickstarter, other than to help fund the research, is to see if it can generate interest. If it meets the goal, the book will be written, and that book will appeal to mainstream publishers who expect authors to have a “platform” from which to market and sell their work. Kickstarter will help me build a platform.

Please take a couple minutes to check out the video and project description at Kickstarter here. I hope you will take a personal interest in supporting it. And, since this is a grassroots initiative, please take another minute to let colleagues and friends know about the project.

Thanks for your support!

Schneck Medical Center, a 2011 Baldrige Award winner, is a 93-bed nonprofit hospital in southern Indiana. “At the forefront of Schneck’s commitment to excellence,” it states on its website, “is the Patient First Culture.” That culture has enabled Schneck to score 100% on 17 of 22 core measures reported for the Centers for Medicare and Medicaid Services (CMS). Its patient satisfaction scores meet or exceed the top 10% or top 25% levels on nine of ten Press Ganey measures. Its hospital-acquired infection rate has been at or below 1% since 2008. It ranks second among 94 hospitals in its geographic region in value-based purchasing, which holds healthcare providers accountable for the quality and cost of their services.

An organization’s culture shapes its decisions. Schneck had limited treatment options for patients suffering myocardial infarctions, taking 120 minutes from the time a heart attack was diagnosed to the first intervention. To put these patients first, it collaborated with its largest competitor, located 25 miles away, to coordinate handing off patients who needed emergency cardiac catheterizations. The initiative has reduced the time between diagnosis and intervention to as low as 60 minutes.

A patient first culture does not mean that nothing else matters. Schneck also values workforce satisfaction: It has consistently been named one of Indiana’s Best Places to Work and recognized nationally as a “Best Place to Work” by Modern Healthcare magazine. Staff turnover dropped by 26% from 2007 to 2011. It values financial wellness: It has improved its bond rating and operating margin and exceeds S&P’s “A-” rated benchmark for five key financial metrics. It values good citizenship: Schneck performs health screenings at no charge to local residents and serves as a major source of health information through regularly scheduled educational programs and health fairs.

The three healthcare organizations that received 2011 Baldrige Awards could not be more different in size and services, from Detroit’s Henry Ford Health System’s 140 sites to Schneck and its single 93-bed hospital to Southcentral Foundation serving Alaska natives in 55 remote villages. Yet all integrated the Baldrige model to achieve excellence in patient and workforce satisfaction, quality outcomes, and financial results. They are roles models for any healthcare organization , of any size, in any situation, that is committed to providing world-class care.

Of those SCF serves, 45,000 live in the Anchorage, Alaska, area and 10,000 live in 55 remote villages accessible only by plane. SCF serves them through a unique health care delivery system, the Nuka System of Care, that focuses strategies and processes on wellness. The system is owned, managed, directed, designed, and driven by Alaska Native people, which SCF calls “customer-owners.”

These unique ownership and health care delivery systems are producing impressive results:

• Customer-owners can see their primary care providers on the same day if they call by 4 p.m. and arrive by 4:30. Seventy to 80% of appointment slots are open at the start of each day.
• Alaska Natives and American Indian people experience diabetes at twice the national rate. Since 2009, SCF’s performance levels for diabetes care have exceeded the 90^th percentile of the Healthcare Effectiveness Data and Information set.
• SFC manages key performance data through DataMall where it is collected, aggregated, trended, segmented, and available to managers, clinicians, customer-owners, and employees.
• SCF’s overall customer satisfaction rating in 2010 was 91%. Its overall satisfaction rating on Consumer Assessment of Healthcare Providers and Systems (CAHPS) was 73.3%, significantly higher than the CAHPS TopBox benchmark of 46%.
• Staff turnover decreased from 37% in 2008 to 17% in 2011.
• SCF’s per capita expenditures percentage change has been lower than the MGA benchmark since 2005 despite its phenomenal growth.

Notice the exceptional results across all critical areas: operations, patient care, patient satisfaction, workforce, and financial. Organizations must be good at everything and great at a few things to win a Baldrige Award, as SCF has demonstrated.

Health care organizations that want to replicate its success can start with the Nuka System of Care, which is based on four principles: (1) customers drive everything; (2) customers must know and trust the health care team; (3) customers should face no barriers in seeking care; and (4) employees and supporting facilities are vital to success. If it works for SCF in remote areas of Alaska, it can work for any health system in the country.

You can read more about SCF and its world-class results here.

To learn more about other Baldrige health care leaders, click on these articles:

• Henry Ford Health System
• Heartland Health
• AtlantiCare
• Poudre Valley Health System
• St. Luke’s Health System

Henry Ford Health System serves a three-county region encompassing Detroit and its suburbs with a workforce just shy of 30,000 employees, physicians, and volunteers. Its revenue in 2010 was $4.08 billion.

It’s hard to imagine the effort it has taken to keep this massive organization moving along the Baldrige path, but its results are a testament to its leaders’ tenacity:

• Rated #1 for member satisfaction among all health insurance plans in Michigan by J.D. Powers and Associates
• Satisfaction exceeding 90^th percentile level for HFHS’s medical centers, with 80% likely to recommend
• Performance on CMS core measures at the 90^th percentile for 75% of reporting areas across the system’s seven inpatient hospitals
• Evidence-based global harm campaign to improve patient safety recognized as a national best practice by the Institute for Healthcare Improvement
• Market leader in the area it serves, increasing inpatient market share by an average of 3% a year since 2004
• Maintained a positive net operating income despite significant increases in uncompensated care—approximately $200 million in 2010
• HFHS’s leaders model and support entrepreneurism throughout the healthcare delivery system
• Best-in-class innovations including the Perfect Depression Program, Home Health Services, Pharmacy Advantage, and OptimEyes
• Monetary support for HFHS’s communities by employees increased to just over $3 million in 2010

For more information about Henry Ford Health System, click on its Baldrige profile.

To learn more about how your organization can integrate Baldrige and achieve HFHS-like results, click on these articles:

• Baldrige Gets Results
• How to Integrate Baldrige
• 10 Steps to an Effective Baldrige Assessment

The study confirms what similar studies of business performance have also shown. No matter what their organizations do, leaders need to consider these results and, if their organizations are not integrating Baldrige, ask how they, too, can achieve similar high rates of improvement.

Thomson Reuters uses independent public data to measure hospital performance and identify the national benchmarks for balanced excellence. It publishes the best 3% in an annual list of 100 Top Hospitals. For this study, it measured the association between 38 Baldrige hospitals (Award winners plus site-visit hospitals that gave permission) and 100 Top Hospitals on key indicators of performance and improvement. The analysis showed:

• Substantial agreement between the results of the Baldrige process and the Top 100 Hospitals award: Baldrige hospitals are significantly more likely than their peers to win a 100 Top Hospitals award.
• Baldrige hospitals were significantly more likely than their peers to display faster five-year performance improvement.
• Baldrige hospitals were about 83% more likely than non-Baldrige hospitals to be awarded a 100 Top Hospitals award for excellence.
• Baldrige hospitals outperformed non-Baldrige hospitals on nearly all of the individual measures of performance used in the 100 Top Hospitals composite score including risk-adjusted mortality, risk-adjusted complications index, patient safety index, CMS core measures score, severity-adjusted average length of stay, and adjusted operating profit margin.

You can read the Thomson Reuters report here.

You can read how businesses achieve similar stellar results here, here, and here.

These studies validate the value of integrating the Baldrige model whether your organization is a hospital, small business, manufacturer, service provider, government agency, nonprofit, or school. The data provide tangible evidence of the efficacy of using the Baldrige process because it delivers “significantly higher rates of improvement in balanced organizational performance” compared to competitors who do not use Baldrige.

To learn more about how your organization can use the Baldrige process to achieve similar results, click here.

She was expertly pampered for the rest of the day, able to get out of bed for a light dinner in the evening, walking the hallways yesterday, likely to be released today. None of it felt rushed. The attention was timely, focused, and compassionate. As a son, I felt relieved at the quality and efficiency I witnessed and at the high level of care my Mom received.

Wright Medical Center is a quality leader. It has integrated Baldrige by applying for the Iowa Recognition for Performance Excellence award. Two years ago, the quality processes it was implementing were described in Quality Progress, the magazine of the American Society for Quality.

I found all of this out when I was wandering the halls waiting for my Mom to get out of surgery. It relaxed me. I’ve worked with dozens of organizations that were integrating Baldrige and all of them aspire to be the best they can be. Wright Medical Center fit that mold. It is patient and family focused. Supplies—medicine, cold packs, food, etc.—arrived when they were needed. Nurses monitored Mom’s vital signs closely after surgery and repeatedly asked about any pain she was feeling and if she needed anything. In a difficult and stressful situation, they delivered a positive experience.

Every hospital employee I talked to was friendly and helpful. By the end of the day, it was easy to see the culture that Wright Medical Center has created because every employee embodied it.

My Mom was very lucky.

To read more about world-class healthcare, click on these articles:

• Baldrige Saves Lives
• Why Baldrige? Saint Luke’s Makes the Case
• A Baldrige Winner’s Health Pyramid
• AtlantiCare’s Baldrige Journey
• Baldrige and Lean in Healthcare
• Baldrige and Magnet Recognition