• Don't make imprudent decisions about your investment in your anti-fraud program. Insurers may look to save money in tough economic times by trimming Special Investigation Unit resources. But this is the time that those precious resources are most valuable. If cuts are to be made, don't cut too deep.
• Leverage analytics to identify anomalies. Optimized business rules, predictive models, and other analytical approaches can help effectively identify anomalous claim activity indicative of fraudulent behavior. Use these tools to focus your resources where they are needed most.
• Trust but verify. The vast majority of insureds are thoughtful, law-abiding customers. But there are some who will try to take advantage of the system. Use text mining technology to scan claim notes for evidence of cash payments, improper use of contractors, or other evidence of potential premium fraud. Prioritize audits of these policies where policy language allows.
• Keep vendors on their toes. Audit billing records and work with your medical bill processing and/or pharmacy benefit management vendors to keep a watchful eye on billing patterns. Use analytics to spot abnormalities or providers who are billing inconsistently to their peer group.

This is the second article in a six-part series based on the material from the book, The Accountable Executive, expected to be released in the Spring of 2012. In this series, Hal Johnson and Ed Street of LeadershipOne, address what they observe as major contributors to low accountability cultures — which they have observed as a meaningful area of struggle in many mid-market companies — and the antidote. Additional articles in the series can be found here: Part 1, Part 3, Part 4, Part 5, and Part 6.

Establishing The Vision And Aligning Activities
When we think of effective direction in a business setting, our thoughts tend to run to strategic planning. That makes sense, since one of the most fundamental responsibilities of an accountable executive is to assure the enterprise has good direction and related activities are in alignment with that direction. The well established processes found in the strategic planning cycle are sound — when fully embraced. Following the sequence of vision --> goals --> strategies --> projects --> implementation is a proven formula for creating effective direction. However, according to research at the Harvard Business School, only about 10% of companies do well with the implementation part. And, mostly, this is attributable to lack of accountability.

Building an organization committed to the highest performance standards demands more than just good intentions: it also requires fostering practices that create an environment of clarity, commitment, and accountability. Without healthy accountability, an enterprise loses one of the key elements of management — predictability.

What Is Accountability?
We are glad you asked, because there seems to be a lack of uniform clarity.

1. It's a commitment — a statement of personal promise, both to yourself and the people around you, to deliver specific defined results. It reflects a winning attitude of "you can count on me."
2. Producing results — results are important so mere activity is not enough.
3. It is meaningless without consequences. Both positive and negative. Not responding to unaccountable behavior is the first step in a downhill slide of performance.
4. At the top level, it assumes a proactive and conscious commitment to the purpose of the organization, manifested by clarity, transparency and participation, which enable contribution.

Where Are You In Embracing Accountability?
Creating an accountable organization is an ongoing process. Members of the leadership team should review practices regularly to assure that effective behaviors are sustaining accountability. In working with client companies where accountability is low, we have studied the various contributing causes. Based on our findings, the following indicators have emerged, pointing to opportunities to ratchet up performance through enhanced accountability. Take a look and see if you can spot a similar "opportunity."

• Unclear purpose and priorities
• Lack of timely decisions
• Duplication of work
• Ineffective meetings
• Long and excessive work hours
• Managers working in their subordinates' responsibility space
• Slow and inefficient decision making process
• Unclear promotional criteria and evaluations
• Loss of good people
• Thinking there is a capability problem

Accountability Shapes What The Company Is To Become
Unlike many change efforts that have come and gone, accountability is neither a fad nor a change that can be ignored. We have clients who have experienced major improvements in performance using accountability building initiatives. Most of these organizations had experienced a time of "let-down" and the quality of their performance diminished. It was also found that accountability had diminished. And, they had stopped looking for bad habits. They stopped checking their measurable variances in performance. They stopped addressing their unresolved conflicts and they stopped dealing with non-performers. As a result, their performance plummeted and they had to reestablish their accountability processes and commitments to get back on track.

The good news was that when they returned to their accountability practices, they quickly became more successful. This time, they had to increase their level of accountability, because the old level was no longer enough to sustain results. When accountability is an ongoing process, excellence in performance naturally increases. It definitely shapes what the company is to become.

The Ultimate Leadership Responsibility
Executives are constantly being bombarded by demands that impact their ability to sustain focus on the key contributors of success. Ultimately, this seems to be one of the major differentiators for long term success — sustaining accountability. Life is much easier when, as a business leader, you are surrounded by colleagues you can count on to do the right things. Building that culture goes a long way toward sustaining predictably good business results. And, right now, we need all of that we can get.

Authors
Hal Johnson collaborated with Ed Street in writing this article. Ed Street is a LeadershipOne Associate and has over forty years of professional and management experience in finance, strategic planning, general operating management and information systems design & implementation. He has a proven record of competence in achieving performance, productivity and cost improvements in team based environments while enhancing long term value creation. He has significant experience in facilitating and teaching finance, entrepreneurship and strategic planning in both academic and business environments.

As Dr. Jason Hwang, co-author of the Innovator's Prescription, has stated, one of the core tenets of disruptive innovation is to use technology to transfer services from costly, expertise-intensive settings into more affordable, convenient, and accessible venues. Doctors from Seattle to South Carolina are demonstrating exactly that by removing the 40% "insurance bureaucracy tax" from healthcare. You might think of it as "two parts Marcus Welby and one part Steve Jobs." The results have been staggering with a 40-80% reduction in the most expensive facets of healthcare (surgeries, scans, specialist and ER visits).

Primary care physicians consistently state that 2/3 of patient office visits could be done remotely via phone or email, but they are disincented from doing this with the convoluted reimbursement models of present day health insurance. If doctors don't see the whites of your eyes, they won't get reimbursed so the result is people taking half their day to get to/from their doctor's office, sit in a waiting room, wait in the exam room and then get 7 minutes with their physician not to mention dealing with all the billing hassles.

Instead, modern day Marcus Welbys are available via electronic means. For example, one physician operating in this new model shared how he hasn't seen a patient with Shingles in five years. His patients simply take a picture of their symptoms with their smartphone and email it to him to verify that they have Shingles. In a few minutes, he can order a prescription and everyone has saved time and money rather than waiting days to get into their doctor. After all, what location is more convenient than one's home?

Some Direct Primary Care providers such as WhiteGlove Health and Organic Medicine Now take it a step further and make house calls that harken back to the days of your family doctor stopping by your house just a few decades ago. Beyond that, they provide simple, yet sophisticated, technology tools for further patient convenience and savings that allow them to cut administrative overhead by 80% compared to a typical medical practice. Rather than patients filling out mountains of paperwork for what seems like the hundredth time, all patient-provider interactions can be done at the patients' convenience whether it's filling out forms, scheduling appointments or requesting medication refills.

Marcus Welby wouldn't recognize mainstream medicine today. In Welby's time, we didn't insure the equivalent of a car tune-up but we do that in most health plans today. Nor did we have insurance middlemen who add no value sitting in between you and your family doctor. Two related items should be done to save individuals, businesses and government a huge sum of money on healthcare.

Make Primary Care More Accessible
IBM and other large employers have studied healthcare costs around the world. IBM alone spends roughly $2 billion per year on healthcare. The findings of their studies came to a surprisingly simple conclusion where countries were getting the best bang for the buck from their healthcare spend: More primary care access led to a healthier population which, in turn, led to less money spent. MedLion, profiled as The Most Important Organization in Silicon Valley No One Has Heard About, has shown they can deliver high quality care with prices that are affordable for low-income workers. This model is referred to as Direct Primary Care (DPC) or Direct Patient Centered Medical Homes (D-PCMH).

As we've seen in Massachusetts, health reform exacerbated a shortage of primary care physicians. Even before that, half of primary care physicians said they would leave medicine if they could. The biggest reason was not being able to practice medicine the way they were trained as a result of insurance-driven productivity goals. A secondary reason was monetary — primary care physicians are the lowest paid physicians. A nice byproduct of Direct Primary Care practices for the primary care physicians is they can practice medicine the way they were trained and by cutting out the 40% "insurance bureaucracy tax" they are taking home significantly more income.

Imagine if we scaled models such as MedLion's and other DPC pioneers such as Qliance nationally. It would be a boon for primary care providers who want to operate free of insurance, as it validates a model that has proven to yield better health outcomes while lowering costs dramatically. Fortunately, one of the least known elements of the new health law may be the most important. It's the Direct Primary Care provision allowing the separation of insurance from day-to-day healthcare to save 40% off the cost of primary care. See Health Insurance's Bunker Buster for more. Showing the bipartisan support for this element of the health reform, a GOP Representative who fought against reform and is an MD has proposed a bill to utilize the Direct Primary Care model with Medicare recipients. This leads into the next item.

Demand A Standard Wrap-Around Insurance Policy
For Direct Primary Care (DPC) to work best, it is paired with a wrap-around insurance policy to cover non-primary care items. Widespread use of the Direct Primary Care model would give insurance companies something that can allow them to underwrite a wrap-around policy to complement what is being delivered via the Direct Primary Care package. This would accelerate the development of independent Direct Primary Care practices as long as they offered the same baseline services (they are free to add things above that to differentiate their service). National scale is critical, as insurance companies can't underwrite for something that is wildly variant. This gets health insurance back to its strength and what insurance is so good for — rare stuff you hope never happens versus insuring the equivalent of a car tune-up.

In summary, a couple simple steps can save hundreds of billions and save primary care in this country which many view as a dying profession. The only downside to this plan is some healthcare providers are resistant to change, but this is a small price to pay for reviving the economy and putting the country on a path where healthcare costs won't bankrupt the nation.

This is the first article in a six-part series based on the material from the book, The Accountable Executive, expected to be released in the Spring of 2012. In this series, Hal Johnson and Ed Street of LeadershipOne, address what they observe as major contributors to low accountability cultures - which they have observed as a meaningful area of struggle in many mid-market companies - and the antidote. Subsequent articles in the series can be found here: Part 2, Part 3, Part 4, Part 5, and Part 6.

In the mid-market business arena (under $1 billion) there are countless senior executives who have come to their jobs through high performance in their "industrial specialties." They have been very good engineers, architects, sales and marketing execs, attorneys, and even general business practitioners. Along the way they have been elevated to more increasingly responsible managerial positions. Often it is the "momentum of institutional management" that has progressed their careers. By that we mean they:

• Perpetuated what had gone on before.
• Followed what their predecessors did and were supported by their peers.
• Followed their intuition.

Yet, they received no formal executive level development or coaching for the senior, or even chief, executive position.

Okay, let's examine briefly what the upper echelon of most mid-market companies looks like. The board of directors is usually comprised of family members and/or close friends. It exists to meet legal requirements, not assist in corporate governance. Therefore, the board seldom establishes clarity of performance expectations with strong accountability.

This is not always the case. We are aware of a few mid-market companies that have established small advisory boards (not an official board of directors in order to avoid liability issues) comprised of outside, experienced business practitioners that do try to guide and support accountable executive performance. But for the sake of this siers, let's assume many, if not most, do not have boards that establish clarity of the executive leadership function with accountability.

We believe every senior executive in mid-market companies could benefit from some systematic application of accountability from an outside review process and the development of a system of management. We start with a framework that identifies the core function of the chief executive, and then we fill it in with what we believe to be the fundamental business practices that will successfully perpetuate the business. In effect, this material is an accountability job description for the chief executive as well as members of the executive team.

Here's what we see happening at an alarming rate: senior executives are not keeping up with the demand that change is placing on their businesses. When times were good, this deficiency was covered over, but now it can be a major distraction. A lot of their leadership and business knowledge is either dated or dangerously low. As business crises arise, the search usually then starts for the fix. Accountable executives are working diligently well in advance of the next crisis to either avoid or at least be better prepared to address it.

Our current economic downturn is creating an abundance of wake-up calls. Business success in this environment is a hard battle. You need all the training, armament, knowledge and skill you can muster. Our hope is this material will bring to mind — and to practice — those processes and practices that will serve to enable you to become an accountable executive who brings robust leadership and management performance to your organization.

We have organized the material that is included in this series around the five functions we believe are foundational to executive leadership.

1. Effective Direction
2. An Effective Leadership Team
3. Peak Performance Culture and Chemistry
4. Systematic Performance Management
5. Change Management / Continuous Improvement

Constantly tending these functions is the executive's job. Sure, there is a lot more involved in being a successful executive, but the health and welfare of the business is dependent on the above functions being well tended. We believe the material presented in the following series of articles will assist those of you who have under-developed management performance to give your business a lift. Injecting high accountability in your culture has high impact on performance. We can't have too much of that.

Authors
Hal Johnson collaborated with Ed Street in writing this article. Ed Street is a LeadershipOne Associate and has over forty years of professional and management experience in finance, strategic planning, general operating management and information systems design & implementation. He has a proven record of competence in achieving performance, productivity and cost improvements in team based environments while enhancing long term value creation. He has significant experience in facilitating and teaching finance, entrepreneurship and strategic planning in both academic and business environments.

The Human Resources notional view of health care benefits needs to change and do so quickly.

At one time the view of health benefits was one of satisfying/motivating employees, closely coupled with a notion that health benefits were a great way to attract and retain top talent. Truthfully, that was never really the correct notion of health care reimbursement models.

Early in my benefit career, I was moved into a HR generalist role in a division of British Petroleum. In that job I interviewed candidates for managerial and executive positions. In a short time something became very clear. Triple "A" candidates rarely asked questions about the health plan. They just wanted to know that there was one. Rather, they asked questions to ensure they would be a good fit, also questions about growth opportunities, and so on. When we hired people like that they tended to be successful.

"C" candidates often asked detailed questions about the health plan, time off programs, and disability benefits. The benefit questions were often highly detailed questions about how many chiropractic visits they were allowed each year, minute details about how the deductibles and out-of-pocket limits worked, plus lots of "what if" questions, etc. Once in a while there were good reasons for those questions, but usually not. When we hired such folks, they tended to do poorly in the company and were often the first to go in the next staff reduction.

My first point is if you use health benefits as a "critical" competitive advantage tool in recruiting, you may very well be most appealing to the wrong people.

My second point is that while companies need to offer a well-rounded package of benefits, health costs are a major risk that needs to be managed. Successful benefit executives going forward will understand this critical difference.

An Insurance Thought Leadership Exclusive

In recent weeks much has been said about contraceptive coverage and whether or not President Obama should have done what he did. As a result of that, many are wondering whether or not other decisions will be made by this special government-formed task force that is part of health care reform. Is this something else that we should fear? Is there value in it? Why or why not?

First of all, I must offer this caveat: I am presenting my own personal opinions, not that of my company, and not necessarily that of my profession or other associations I am part of. This is a controversial topic and it is likely that some readers will disagree with my comments. I accept that and would like to share my opinion, perhaps adding some light on the topic.

Background
Perhaps a look back might be helpful in understanding the situation or health care system as it stands today. Today, who determines whether or not a service is beneficial to a patient? Most of the time, this is determined by the physician or provider delivering the service. We, as patients, select a provider we trust, and listen to what they recommend to us, perhaps supplement that with a visit to WebMD.com or its equivalent, perhaps ask a friend or relative, but generally listen to our doctor and do what he says. Who is to say that our provider is right? For many years we didn't question this, and if we did we would find a new provider who we did trust.

The reality of the situation is that in many situations our provider might not be making the best choice on our behalf. First of all, there is somewhat of a financial conflict of interest. If they provide the service, they benefit financially. If they don't, they are paid less. Will the decision be impacted by the financial outcome? Secondly, providers are heavily impacted by their current practice style, their training and what they are familiar with. Studies show that practice patterns vary between various markets, and even within a single market. What makes sense to one provider doesn't to another. What is the norm in one city can vary significantly from that in another. What makes sense to one specialty may conflict with another specialty. Today we really don't have any single authority that we can rely on and trust. So by default we listen to those we trust who might not be as trustworthy as we think and believe.

Potential Solution
Realizing the potential for different opinions and the lack of a trusted source, individuals and organizations began a concerted effort to try to define what is right and wrong. Company A started to build its set of criteria or practice guidelines while Company B developed theirs. Provider Specialty C developed theirs, while Provider Specialty D pursued another path. Individual health plans developed their own or licensed one or more sets from various vendors and other sources. The government even established a clearinghouse (i.e., Agency for Healthcare Research Quality) to monitor and keep track of various guidelines. The proprietary ones were copyrighted, oftentimes requiring substantial license fees to use. Others were made available to all at no cost.

Through this effort a concept called “Evidence Based Medicine” emerged which described a process where the best literature and evidence available was used to develop the guidelines. Through this process, evidence is graded (i.e., from most reliable to least reliable) with specific information synthesized and guidelines produced. Some guidelines were built around a desire to maximize efficiency and control costs, others where focused in other areas. The significant effort has resulted in very valuable information from competing sources, potentially with differing opinions. This source of information provides the provider community additional information for it to make a decision; however, some will not have access to all of the information for a variety of reasons noted above.

The Big Dilemma
So we are now faced with a big dilemma. If we leave it up to individual physicians to make the choice for treatment, we are faced with significant personal bias, perhaps with some limitations in a valid rationale to make the necessary choices. If we rely on the vast guideline options and choices, we have more useful information to help make the choice but are faced with what do we use, how do we use it, and what should we use. Who is going to sort through the information to help assure us the right choices are being made? Can we rely on the provider to do this? Do we rely on the health plan? Can we rely on the internet? Today there is no real source such as the “Good Housekeeping Seal of Approval” for health care guidelines to tell us what is the right answer. What do we do?

A Surprise Solution
Buried in health care reform legislation is an interesting group called the United States Preventive Services Task Force. The primary purpose of this group is to make the decisions we talk about above. To keep the government out of the decision making process, this committee is somewhat independent of regulation by the government. The members of this panel are charged with making good decisions. The use of a national body will maximize the likelihood that this can become the standard. It won't be biased from a health plan's profit motive. It won't be biased by the financial bias of our personal provider. It will rely on the best information available to make the right choice. It will include an important emerging area called Comparative Effectiveness where emerging technologies can be compared to determine what works the best.

It isn't designed to prevent us from having something done we would like to have done, but if not on the list, we might have to pay from our own pocket. It will become the standard of reasonableness. It isn't something to be feared as long as it can remain somewhat independent and focused on pursuing the right answers. Periodically I am pleased to find government-developed, valuable solutions to concerns I have about the health care system (e.g., RBRVS relative values for pricing of physician services, risk scoring, etc.). This Task Force is another one of these in my professional opinion. This may be hard to believe to some who have limited trust in what the government has done or is doing.

Caveat
As long as the politicians let this task force operate as it was intended and recruit the best people to serve on it, I am confident that all Americans will benefit. The big problem is that it looks like another attempt by government to control our lives. I prefer describing it as an attempt by the government to protect us from bad decisions by ourselves and those we try to trust, our health care providers. I come down on the side of applauding this effort, not criticizing it.

• Stay calm
• Don't admit fault
• Promptly report to your broker

• Note the time and date you were served with the lawsuit directly on your copy of the lawsuit.
• Make a copy of all of the papers you have received, keeping one for yourself and sending the original to your insurance broker.
• Call your insurance broker to let him or her know that lawsuit papers are coming.

• Designate a media spokesperson (and at least one back-up). These persons should be trained in advance of a crisis about what is and is not appropriate information to release to the media.
• Make sure that everyone knows the identity of the designated spokespersons(s). Nonauthorized persons, including staff, volunteers and board members, should not talkto the media.
• Do not admit wrongdoing. Keep in mind that anything said to the media by anyone in a position of authority can be used against the organization in any litigation that results. As tempting as it might be to admit liability to "get it off your chest," you can be sure that this admission will greatly diminish your attorney's ability to defend you in a lawsuit.
• Remember that "no comment" says a lot. "No comment" fills pages in the minds and imaginations of readers and viewers. What is the organization trying to hide? Isn't there anything it can say about this dreadful event? Count on the fact that a skillful reporter will find someone to comment about the incident — including your organization's handling of the crisis. Remember to think carefully about what you say and what you don't say.
• Stay calm and "on message." The key is focusing on the message you want to deliver. Advance preparation is necessary.
• Deliver a positive, truthful message about your organization. While it is important not to evade a reporter's questions altogether, always begin your response with a positive message about your organization which incorporates your commitment to safety. For example, "The mission of the Youth Activities Center is to promote safe recreational activities for disadvantaged children in this community. Our commitment to safety is reflected in our safety training programs for athletes, rigorous screening and training program for volunteer coaches, and provision of appropriate safety gear for all participants."
• Do not improvise your answers. If you do not know the information asked by the reporter, admit that fact and if appropriate, pledge to find out as soon as practical. Establish a time and place to provide information updates.
• Show concern and compassion. Compassion for victims and those who are disadvantaged by circumstance, physical disability or economic status is at the heart of the work of many community-based nonprofits. The public expects a nonprofit spokesperson to demonstrate compassion. Never dismiss an incident where victims are involved as inconsequential.

Let's hit a few highlights of 2011. In the past, I've described certain scary trends in health care in the United States:

• US spending on health care is lapping our peer countries while our life expectancy is declining comparatively. This is a major drain on our economy and is costing us jobs.
• We have a huge amount of unnecessary surgery and testing. It's getting worse, not better. (Read The Treatment Trap by Rosemary Gibson and Janardan Prasad Singh for real life examples.)
• In health plans today, a small number of members are spending most of the money. I've seen very large plans in which 10% of members are spending 80% of plan dollars. These "outliers" are usually in the middle of serious acute health crises and are way beyond wellness, preventive, value-based purchasing, Health Savings Account incentives, consumer driven health care, public/private partnerships, etc. "Outliers" often need specialized tertiary or quaternary care.
• There is huge variation between tertiary and quaternary referral centers in terms of getting the diagnoses right, having the best outcomes, and saving lives. The best referral centers are the most cost effective too.
• Most specialists in the United States don't coordinate care or diagnoses. As a consequence, a large number of "outliers" are misdiagnosed and/or have bad treatment and surgical plans. This is a huge opportunity for benefit plans.
• Alas ... we know that true reform can never and will never come from Washington. Members of Congress will see to it that clinics and hospitals in their districts are protected.
• Health insurers understand this but are often not supported by corporate benefit executives when they delete poor performing doctors and hospitals from their networks.
• Most benefit executives are looking for the deepest discounts when selecting a network, not the lowest net cost, a big difference. Lowest net cost comes from getting diagnoses right, avoiding bad surgery, and coordinating care. Those traits trump deepest discount every time. A small but growing number of large corporations are getting this one right.
• If the system is to be reformed it will be done by corporate benefit executives. Congress can't. Insurers can't.
• Most of the clinicians who over-test and do a poor job of getting diagnoses and treatment plans right aren't going to improve until someone takes their patients away. Period.

The question is, how to take their patients away. There's a way.

If you are a benefit executive:

• Ask your Third Party Administrator, carrier, or Preferred Provider Organization to start figuring out who the "A players" are and load your networks with them. Ask them to identify the "C clinicians" and begin the process of deleting them from your network. The savings potential from this is huge. Plus, you will be protecting your employees and improving the quality of their care.
• Educate your employees about this.
• For your outlier population, implement centers of excellence for their specialized needs.
• If your company has more than 5,000 covered lives or so, you should develop and implement direct contracts with the best of the best centers of excellence, ones like the Mayo Clinic and the Cleveland Clinic. Great companies like Pepsi, Walmart, and Lowes have done just this, plus many others. You can do it too.