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Process mismanagement in American health care

Carol Tanzi was never trained to treat her patients like cars on a production line. Neither were her colleagues at Robert Wood Johnson University Hospital in New Brunswick, New Jersey. Neither were the nurses at Mount Auburn Hospital—where I recently spent an evening following a bike accident—and, I hope, neither were the nurses in any other emergency room. When Tanzi and her colleagues came to believe that the same, perhaps, could not be said for their hospital’s administrative management, she joined some seventeen hundred of her fellow unionized nurses on the picket lines. According to Tanzi, working conditions had “become unbearable to endure any more—morally, legally, or ethically.”

The strike at RWJUH—now in its fourth month—and similar worker actions at Kaiser Permanente are just the latest in a string of nurses’ strikes across the country. In the last three years, nurses in Wisconsin, California, Oregon, New York, and elsewhere have walked out of their hospitals, clinics, and health care facilities to protest deteriorating, if not outright unsafe, working conditions. By one estimate, nurse strikes accounted for over half of all workers involved in strikes that year. There is a crisis in nursing; ask any nurse.

For Tanzi, the strike was a long-time coming. In her twenty-plus years as a pediatric recovery room nurse at RWJUH, she’s seen hospital CEOs come and go, and a blizzard of reports and recommendations authored by anonymous consultants. Between overwhelmed emergency departments during the acute phase of the Covid-19 pandemic, hospitals’ increasing reliance on temporary travel nurses, minimal reimbursements from insurance companies, and private equity’s incursions into the industry, there are no shortage of causes for the malaise in medicine. Cost-cutting, certainly, is at the center. At the periphery is a rich history of business ideology and theory working to respond to corrosive incentives and crises in medicine not with systemic changes but with highly technical “process management systems” aimed at “just in time” quality medicine.

Lean management’s evangelists promise continual improvement in the quality of health care by “listening to workers at all levels” and “empowering” even the most junior worker.

When Tanzi started nursing, Toyota was notable in hospital emergency departments for little more than the car accidents their drivers suffered. Over the last three decades, however, a cottage consulting industry has emerged, specializing in the application of the “Toyota Production Model” and Motorola’s “Six Sigma”—both famous in business literature for their miraculous effects on production lines—to hospital “process management.” Over the last three decades, hospital administrators have carved out their own process management ideologies. The result: “lean management,” a cluster of efficiency-boosting strategies borrowed from Toyota’s factories, including work process management, supply-chain design protocols, and “continuous improvement” management structures. Lean management’s evangelists promise continual improvement in the quality of health care by “listening to workers at all levels” and “empowering” even the most junior worker to be their own managers. The promise is scientific management without rigidity, efficiency without loss in quality. In reality, it often delivers the opposite.

The Toyota Production System emerged in the wake of the Second World War, after a Japanese industrial engineer named Taiichi Ohno, a thirty-year veteran of Toyota production plants, traveled with several other Japanese automakers to observe American manufacturing practices. Ohno found assembly line production rigid and inefficient. He collected his findings in a 1978 book of recommendations, foremost among them that muda, or wastefulness, must be eliminated from every stage of the production process.

At Toyota, his word became gospel, and by 1975, they were the leading car import to the United States. But only in 1988 did an English translation of Ohno’s book land—just in time for NAFTA’s free trade bacchanal. Ohno’s book in hand, C-suite executives began devoting themselves to the study of Toyota’s success. American manufacturing had, for a long time, followed Frederick Taylor’s models for assembly line production; Toyota’s more nimble model was the way of the future. In board meetings and in convention centers, auto titans boasted of the powers and promise of the Toyota method. In 2001, an updated version of Toyota’s fourteen management principles—now dubbed The Toyota Way—made its way onto executives’ reading lists. Jacket copy assured bosses that they could “double or triple the speed of any business process. Build quality into workplace systems. Eliminate the huge costs of hidden waste. Turn every employee into a quality control inspector.” The age-old trade-off between worker empowerment and cost efficiency was, thanks to Toyota, no more.

Today, Toyota Production System boosters and researchers alike often refer to the system in its original Japanese, with reverence for not just the spirit but the letter of the TPS. Standing at the center of the system, kaizen, or continuous improvement, has itself become the subject of fierce debate on LinkedIn posts and online blogs over its original meaning and proper reinterpretation. At the heart of the dispute is the relationship between improvement and cost cutting; a clash between lean management’s high priests and a sect of its practitioners, who mobilize the language of “lean” to indiscriminately cut costs.

As domestic automakers started adopting the Toyota mindset, so, too, did health care managers. In 1989, just a year after the English translation of Ohno’s book, Don Berwick—who would later become Barack Obama’s chosen director of the Centers for Medicare and Medicaid Services—wrote an oft-cited article for the New England Journal of Medicine. In it, he claimed that health care could learn a thing or two from Japanese production models, that the ethos of “continuous improvement” demanded radical changes to the provision of care. Among them, Berwick listed more attention to the needs and desires of workers on the ground, and less adversarial relationships between management and workforces. The approach, which came to be known as “lean health care,” was soon in use by large hospital systems across the country including the Virginia Mason Medical System and the Cleveland Clinic. Toyota’s process was going to mend health care’s ills, improve patient outcomes, and democratize the workplace in the process. And—best of all—it was going to cost a lot less.

Early research was slightly underwhelming but not altogether unpromising. Lean health care, researchers claimed, improved things like wait times and reduced errors like prescription mistakes or unforeseen drug interactions. Spurred by this research, Mark Graban, a MIT-trained industrial engineer who now operates a blog on lean health care, began consulting work with hospitals in the mid-2000s. Today, Graban is no less convinced of its effectiveness. There is some justification for his optimism: some clinics, among them the Cleveland Clinic, claim to have found success on their “lean journey.” But “success” is far from guaranteed, and also difficult to measure.

Other recent research questions these results. Even those most enthusiastic about lean health care occasionally point out that quality improvements, while perhaps statistically significant, are not quite as massive as its proponents would hope. Indeed, even Graban recognizes that the Toyota Way is not a panacea. Discussing cost cutting, Graban cautions “that’s not lean. That’s lame. That’s Taylorism. I’m opposed to that just the same.” The problem, Graban says, is that “health systems can apply this lean label to anything that they’re doing, you know, whether there’s any kind of fidelity to the real Lean principles.” The problem, according to Graban, is in implementation—the system can work well, and it’s a shame that so few hospitals apply it properly.

An early adopter, Robert Wood Johnson University Hospital has been cited in management literature as a lean queen among American hospitals for more than a decade. In 2011, one report on lean management touted RWJUH’s success “empowering nurses.” Tanzi remembers things differently. As health care executives got drunk on the Toyota promise of workplace empowerment, Tanzi and her colleagues saw more and more consultants coming in and out of her pediatric recovery room. Tanzi tells me about one of the many times in the past two decades when RWJUH decided to expand its children’s medical center. In the design process, administrators sent around surveys and requests for input from staff. “They asked for nurses’ input, which we gladly gave and then proceeded to do none of it,” she tells me. The result was not a medical center well-designed for her needs. “What they created was an area that doesn’t flow with how people work. It’s the biggest joke.” There were too few recovery rooms for the number of operating rooms. Patients were forced to wait on gurneys in hallways and rushed out of procedures as quickly as possible.

In the spirit of Ohno’s relentless pursuit of economy, lean consultants aim to “optimize” simple things, like finding the ideal location of medical equipment to minimize movement. At RWJUH, even the location of medical gloves, Tanzi says, was analyzed and adjusted by lean process tinkerers oblivious to the actual workflow of nurses and doctors. “It’s insanity,” she tells me. Here was a hospital once praised for its lean management, for its empowering approach to nurses’ input. Here was an attempt at lean process improvements on the margins, an approach which opted for management expertise over what nurses like Tanzi actually wanted—more staff. Consultants and executives had been left to their own to determine what constitutes “waste,” and, to the surprise of few, their answers differed from workers on the ground. Was lean management merely misapplied? Or was lean management a misguided response to the corrosive business incentives of American health care?

Treating patients is more complicated than building a V8 engine.

Workers actually employed in emergency departments tend to think it’s the latter. Recently, Mark Drexler, a California nurse, voiced the dangers of lean health care and its accompanying cost cutting in Jacobin. The “adventure in lean production has produced a staffing crisis in health care that we’ll be dealing with as workers and patients for years.” What’s more, he wrote, lean health care’s promised “worker empowerment” often did no more than push some workers into managerial positions designed to undermine worker solidarity in the hospital.

Just before the Covid-19 pandemic, Keith Corl, an emergency doctor in Rhode Island, drew a direct link between the recommendations of “lean” health care consultants and rushed, sloppy, and dangerous emergency room triage procedures. Following the principles of “lean production,” Corl said, consultants reorganized emergency rooms, sending medical professionals to conduct early, rapid triage assessments of patients while they waited for further care. The system was supposed to shave precious seconds off the length of stay in the emergency department and improving care efficiency. According to Corl, provider in triage systems did no such thing. Instead of saving patients, Corl wrote, “Working with limited information, the provider in triage often resorts to shotgun testing—over-ordering laboratory tests and imaging studies out of fear of missing the diagnosis.” The irony is plain: provider in triage systems may actually inflate medical costs while rushing what ought to be careful, methodical care.

These were precisely the issues writer and doctor Jerome Groopman raised when he penned a piece in the New England Journal of Medicine declaring that lean health care had ushered in a pernicious form of “medical Taylorism.” Process management, he claimed, pushed aside doctors’ and nurses’ autonomy, prescriptively arranging tasks that by their nature demanded immense flexibility, empathy, and creative thinking. Defenders, many of them “lean” consultants, jumped in to argue that lean health care was not evil—it was just misapplied.

As the gaps between executives and nurses widen, flexibility and “worker empowerment” often became no more than post-hoc legitimations of technocratic management. Low reimbursements from insurance companies and increasing health care consolidation only make things worse, incentivizing cost cutting over effective medicine. When health care organizations are thrust into competitive private markets, bought and sold by private equity firms, it’s no wonder that higher-ups would find solace in lean process management. At best, lean health care is an adaptation to these broken incentives. At worst, it serves to legitimize them.

When I spoke to Wendy Dean, an expert on the moral injury nurses and doctors experience as they’re pushed to their limits in ever more brutally efficient health care settings, she echoed Groopman’s concerns. “Any logistician will tell you that ‘just in time’ reliably fails in a crisis,” Dean told me. “And yet, we’re allowing those institutions that are set up specifically to respond to crises to use [it].” What for administrators and managers is a minor statistical outlier—a “bad outcome” in health care lingo—is, for a doctor or nurse on the floor, a patient left waiting for supplies, staff, and treatment that were anything but “just in time.”  

Reflecting on Toyota-inspired process management in her own hospital, Tanzi laughs. “I would love to just change someone’s oil,” she tells me. But treating patients is more complicated than building a V8 engine. Part of her job, she says, is spending time empathizing with patients, to explain their medication to them, and, ultimately, treat them and to help preserve their dignity. In her second month on strike, Tanzi told me, “It’s sad that the hospital does not share any of those values with us.”