Kaiser Permanente: An Integrated Delivery Health care System Essay

Kaiser Permanente: An Integrated Delivery Health care System

Kaiser Permanente is a managed care facility that provides services across the health care continuum. Over the years the organization has continually made efforts toward improvements since it was first founded in 1945. These improvements generate a series of successes that set Kaiser apart from similar organizations. But, just as any health care delivery system, Kaiser has faced challenges in the past, present and may continue to do so in the future. In this paper I will explain what attributes to the success of Kaiser Permanente and some of the challenges they face.

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Kaiser Permanente is an integrated managed care facility that became open to the public in 1945. Presently, the organization operates 35 hospitals in California, Oregon and Hawaii. There are three entities that make up the Kaiser Foundation: the Kaiser foundation Hospital, the Kaiser Foundation Health plan and the Permanente Medical Groups. According to one of the company’s websites, Kaiser’s mission is to provide “affordable, high-quality health care services to improve the health of our members and the communities we serve. This long-term internal operational strategy, when executed fully and consistently, will differentiate us from other healthcare organizations” (http://www.sdnsec.org) As published in the August 2012 San Diego Business Journal, Kaiser believes the way they deliver health care differs from other organizations. One reason being is that they play every position across the care field, from providing the insurance to delivering the health care and health related services. Another explanation derives from their continued innovative efforts to improve efficiency, such as: information continuity, peer reviews, care coordination and providing easier access to care. (San Diego Business Journal August 2012)

The information continuity effort made by Kaiser has resulted in electronic health records system called KP Health Connect. This system was implemented successfully in April 2008, it allows the access to health records, patient and physician management tools, educational resources, messaging system, billing and so forth. This comprehensive health information management system integrates several departments and has demonstrated to be a very essential asset to the Kaiser Foundation (Commonwealth fund June 2009). The KP Health Connect is very essential in clinical settings because the patient care data such as lab tests, notes and digital images can be easily accessed. The EMR also reduces coding errors which allows order entry’s to go through smoothly and improves medication reconciliation. (Douglas, Orthopedics Today June 2010) There have been concerns regarding cost of this health care information system and whether or not there will be financial benefits from using this system.

In the Orthopedics Today Article, Electronic medical records: Ascending the Tower of Babel, an orthopedic surgeon Dr. Randale C. Sechrest states, “A lot of folks have argued that when a practice implements an EMR, it is not the practice necessarily that benefits,” the practice takes a huge productivity hit to implement the EMR and a huge cost” (Douglas, Orthopedics Today June 2010). Also stated in the article by Dr. Richard M. Dell, “The biggest pro of using an EMR is that it can increase the efficiency in your office, But to see this efficiency increase, the EMR must be implemented correctly and the EMR must be used correctly as a tool for better patient care and office efficiency” (Douglas, Orthopedics today June 2010).

The peer reviews among physicians is another component at Kaiser that is paramount in assuring optimal patient care. The medical teams not only deliberate within the same region, they also connect on an international level to achieve their most favorable potential. (Commonwealth fund June 2009) The idea of cross-learning both locally and regionally can be very rewarding in the medical field because these health centers are usually culturally diverse environments. This form of communication allows physicians to better grasp certain cultural disparities and more effectively treat patients. (Commonwealth fund June 2009) The fact that there are broad spectrums of services available within the Kaiser Permanente network makes it easier to coordinate patient care.

For example the Northern California site has implemented programs that focus on five “imperatives of personal care”, which are: patients have to have a primary care doctor, they need to be able to see that physician, patients that call have a short telephone wait, patients should receive timely appointments and have a great care experience (Commonwealth fund June 2009). Care management definitely plays a crucial role in health care. When the patients needs are met and quality care is received the result is patient satisfaction and potentially cost saving for the organization. Patients not only have to deal with health issues, many experience challenges within their environment and certain limitations depending on socioeconomic status. Therefore , coordination of patient care is key to the success of any health care delivery system.

These key elements mentioned are just a few components that contribute to the success of Kaiser, but with success come failure. Although the Kaiser Permanente Foundation seems like an ideal integrated facility to many, they have experienced some ridicule over their high premium rates. In The New York Times article written by Reed Abelson, George c. Halvorson who is the chief executive of Kaiser acknowledges, “Kaiser has yet to achieve the holy grail of delivering that care at a low enough cost. “ (Abelson, New York Times March 2013) As shown in exhibit A, The Kaiser Family Foundation HRET Survey conducted from January to May 2013 showed a significant increase in premiums.

One possible reason Kaiser sets high premiums may be due to their patients having a piece of mind. Because this network is a truly integrated health care delivery system, their patients tend to be stable and satisfied. They can provide all the fundamental services to all of their plan members. The fact that there should be no disruption in the care or services the patients receives, perhaps gives the organization premise to have higher premiums. Maybe Kaiser wants to increase their revenue or maybe having higher premiums will make consumers think before using unnecessary medical services. An article posted on Physicians for a National Health Program Blog also discusses how Kaiser Permanente is a model health maintenance organization with the highest premiums for California’s new exchange. One explanation given was, the rise premiums are to divert the “really” sick or better yet individuals with preexisting health conditions to competitors with lower premiums. (McCanne, Physicians for a National Health Program June 2013) Kaiser also experienced some criticism for denying individuals health care coverage. In the article published in the The Business Journal Serving Greater Sacramento 1996, Kaiser Permanente was held responsible for the unreasonable denial of health care coverage and incomplete follow up on emergency room patients by the State Regulatory Agency. The Kaiser Health plan was “faulted for denying $14.8 million in member claims for emergency care as well as failing to schedule follow up appointments”, but the “Kaiser executives stressed that the problems are administrative in nature and do not indicate poor quality healthcare.” (Robertson, Kathy The Business Journal Serving Greater Sacramento 1996) The actual “unreasonable” denials were not discussed, but we can assume many if not all were due to pre existing medical conditions. Insurers can decide to not treat or refuse coverage to those who have serious health conditions. But as of 2014, under the Affordable Care Act no one can be denied coverage due to pre existing medical conditions.

Presently, the issues regarding denials in health care coverage or patient follow-ups have been almost nonexistent. In the March 2013 press release from JD Power and Associates, the Kaiser Foundation Health Plan ranks highest in member satisfaction with health plans in the California region. According to the J.D. Power and Associates 2013 Member Health Plan Study, the Kaiser Foundation Health Plan got a satisfaction score of 760 compared to the average in the California region of 706 (J.D. Power and Associates Reports 2013) Kaiser Permanente also received the Gold Seal from the Joint Commissioner for the Leapfrog Hospital Quality and Safety Survey 2013. This survey is conducted to gather information from health care providers and to inform the community of compliance with quality and safety of care. (Kaiser Foundation Health Plan Ranks Highest in Member Satisfaction among Health Plans in the California Region, March 2013) Some people will believe Kaiser Permanente to be the greatest health care delivery system and others will believe it’s not such a great organization. What I have learned from doing this research is that whatever mistakes the institution has made, has resulted in some form of improved quality. The “thing” that makes Kaiser Permanente special is indeed the well functioning, integrated system. The ability to provide health care coverage as well as broad range health care services seems essential to the success of Kaiser. Even though this
organization remains a model for others, they may always face challenges; But the Kaiser Foundation simply reflects the ambiguity of the U.S. healthcare system. According to the Kaiser Family Foundation/Health Research & Educational Trust (HRET) 2013 Employer Health Benefits Survey, the premiums for employer-funded family health coverage went up 4 percent from last year. Will the cost of premiums continue to rise or will they remain stagnant for the upcoming years? I don’t think there is a definite answer. What it boils down to is, can the Kaiser Foundation deal with these changes and continue to remain the ideal model for upcoming integrated organizations?

1. San Diego Nursing & Allied Health Service – Education Consortium http://www.sdnsec.org/kaiserpermanente/forms/KPPromise.pdf Accessed 10-18 2013

2. San Diego Business Journal Best Places to work and HR Professional Of The Year Awards Supplement, August 20, 2012 v33 i34 pS29(1) 3. Douglas McCarthy, Kimberly Mueller, AND JENNIFER WRENN Case Study Kaiser Permanente: Bridging the Quality Divide with Integrated Practice, Group Accountability, and Health Information Technology. Organized Health Care Delivery system June 2009 Commonwealth Fund pub. 1278 Vol. 17 pages 2-15 4. Reed Abelson. The New York Times, The Face Of Future Health Care.published March 20,2013 5. Don McCanne Physicians for a National Health Program Blog exchange? Posted on Thursday, Jun 13, 2013. Accessed 10-16-2013 6. Kaiser Family Foundation HRET Survey of Employer-Sponsored Health Benefits, 2013 Summary of findings. August 2013. Page 2. Accessed 10-10-13 7. Robertson, Kathy. “Kaiser nicked in state review.” The Business Journal Serving Greater Sacramento 9 Sept. 1996: 1+. General One File. Web. 20 Oct. 2013. 8. Douglas W. Jackson, MD Richard D. Dell, MD Orthopedics Today. Electronic medical records: Ascending the Tower of Babel. June 2010. Accessed 10-18-2013 9. Kertesz, Louise IS THE NATION’S LARGEST HMO A MODEL OF COST-EFFECTIVE, QUALITY CARE OR A GREEDY MEDICAL FACTORY THAT ENDANGERS ITS PATIENTS? Modern Healthcare. 08/25/97, Vol. 27 Issue 34, p61. 6p.

10. Kaiser Foundation Health Plan Ranks Highest in Member Satisfaction among
Health Plans in the California Region WESTLAKE VILLAGE, Calif: 11March 2013