by Kennedy Smith

On March 9, President George W. Bush and Commerce Secretary Don Evans presented seven organizations with 2003 Malcolm Baldrige National Quality Awards in recognition of their performance excellence and quality achievements. One of the winners was Saint Luke’s Hospital of Kansas City, Missouri.

Founded in 1882, Saint Luke’s Hospital is the largest hospital in the Kansas City metropolitan area. Affiliated with the Diocese of West Missouri of the Episcopal Church, the not-for-profit organization provides 24-hour teaching and referrals in every health care discipline. Although Saint Luke’s Health System comprises nine facilities, the Baldrige Award was earned solely by Saint Luke’s Hospital.

What follows is an interview with Richard Hastings, CEO of Saint Luke’s Health System. Hastings addresses the challenges that accompany becoming a benchmarked health care facility.

QD: When did Saint Luke’s first begin its Baldrige journey?

Hastings: It was in 1995, but we didn’t start the journey with the award in mind. We utilized a consultant who had suggested, “If you build it, they will come.” We decided to concentrate our Baldrige journey on Saint Luke’s.

Although our organization was an excellent hospital with great employees, it was managed in silos. In other words, departments weren’t integrated throughout the hospital.

Back in the 1980s, when I was chief operating officer, I was looking for some process that would allow us to align all of our objectives and to integrate departments and eliminate silos.

QD: Did you explore other quality initiatives?

Hastings: We looked at several, including Six Sigma. We studied W. Edwards Deming and looked at various approaches. Eventually we decided we’d utilize the Baldrige process. We implemented it, and that same year, we won our first Missouri Quality Award, which strictly follows the Baldrige criteria. Although our score wasn’t exceptionally high, the most valuable result of the process was the feedback report. We, again, received the Missouri Quality Award two more years. We’re the only organization to receive the award three times. Winning the state award had given us enough feedback to start changing our process, which allowed us to start earnestly pursuing the Baldrige Award itself in 2000.

QD: When did you first apply for the Baldrige Award?

Hastings: We first applied in 2001. We didn’t get a site visit, but we did get a great feedback report that allowed us to focus on some improvements we needed to make, including using the balanced scorecard. We have hundreds of quality measurements, but implementing the balanced scorecard helped us synthesize--according to our strategic plan--the five focus areas that we have here. The balanced scorecard was a way to educate our employees on how we were doing with each of our goals.

We applied again in 2002 and received a site visit, which produced even more knowledge. We had already implemented performance management plans for all of our employees; each employee had his or her own management plan. We also began a process to evaluate not only our goals and objectives but also how our various processes were working as an integrated system.

The site visit made us realize that we were close to receiving the award, except for in one area: our supply chain management. We had not been documenting and integrating these processes as well as we should have. After focusing on this, we applied in 2003, had a successful site visit and won the award.

QD: You mentioned earlier your “five focus areas.” Will you explain those?

Hastings: The first item on our plan is “people.” Our concept is that everything that we do is built upon our people, and our strategic plan is actually built the same way as our scorecard. The second area is “clinical and administrative quality.” This is a selection of quality indicators of which we have about seven. These relate to both clinical quality and administrative quality. The third focus area is what we call “growth and development.” This is similar to any business; for example, market share is included. We also have a section called profitable market share. The fact is you can have all the market share you want but if it isn’t profitable, there’s no point. The fourth indicator is “customer satisfaction,” which includes several key measures, like overall satisfaction, “longer than expected wait time,” complaints, etc. The fifth area is “management.” The idea is that if we have good people managing correctly, we’ll provide quality care, and, in turn, our market share will grow. If all five of these factors come together we’ll satisfy our customers and have excellent financial performance.

If you look at our strategic plan, you’ll see that each element falls under one of these five areas. One of the best practices we have is that we put people first, which has allowed us to win the Large Employer of the Year Award in Kansas City almost every year. Its administrators actually asked us a couple of years ago not to participate so that others could have a chance to win.

We ask ourselves, “What are we going to do to make the lives of our employees better?” and, “What are we going to do to make the work process more rewarding?”

Each employee in the company has his or her own VIP (very important principles) card, which states our mission and values. On the back of the card, employees can identify how their job relates to one of our five strategic goals. Once more, there’s a place on that card for them to identify what their specific goals are for the year.

The Baldrige process is a great management tool because it aligns all of the organization’s goals and does away with silos. Also, involving the employees results in a workforce that wants to stay. Our turnover ratio is currently about 7.8 percent; if you put that up against any other business of any kind, this is an incredibly low number. In fact, our nursing turnover rate is less than 6 percent. Both of those are best-practice benchmarks in the country.

QD: Is it difficult to find hospitals to benchmark your organization against?

Hastings: They aren’t as difficult to find as they were in the early years; getting people to share clinical data was difficult. Financial information was always easy to receive because we used Standard & Poor’s measures. One of the Baldrige criteria is benchmarking against other industries, and so we don’t have a problem at all.

In terms of clinical benchmarking, however, it’s more difficult. In the early years, we primarily used national standards as benchmarks. For example, there is an infection control rate for surgeries that’s published by the Centers for Disease Control and Prevention, and we used that literature to assess ourselves.

In the last three years, we’ve had the good fortune to be part of Voluntary Hospitals of America, which has a program comprising 18 institutions throughout the country willing to share their entire clinical data. These hospitals are high-profile, nationally known benchmarked hospitals. We’re really not interested in just being the best in Kansas City. We want to be the best in the country.

Perhaps our biggest challenge now is to ask ourselves which quality measurements are most important to us. It seems like every organization in the United States is now trying to give some kind of report card on hospitals.

QD: Based on your last feedback report, what will you be working on in the future?

Hastings: We’ll be working on second- and third-level process improvement report cards. By that, I mean we’ve got a great overview and we’ve got reviews by departments. We’re going to look at a higher level of process improvement. This is a journey that will never be over. Because medicine and science are constantly changing, what is a good process today might not be a good process tomorrow.

The other thing we’re working on is moving all of the hospitals in our system to Baldrige-based implementation. As the leader of our system, the focal point is pushing our quality out toward the other facilities and totally integrating our system.

QD: When Saint Luke’s is eligible, will you apply again?

Hastings: We probably will. In the interim, we’ll apply for the Missouri Quality Award as soon as we’re eligible because we want those feedback reports. We’re going to keep developing our system as if we are going to receive a feedback report and ask Baldrige reviewers to take a look at how we need to make improvements. So, simply because we’re not eligible for either of the quality awards doesn’t mean we’re not going to do the same things we’ve been doing.

About the author

Kennedy Smith is the associate editor of Quality Digest.