Change management theories as applied to healthcare improvement

Select a problem or issue in the healthcare industry that you know needs changing or improvement.

One area within the healthcare industry that required change and improvement are costs. Costs relative to other developed nations is very high, without the corresponding benefits of such costs. Currently the Untied States spends roughly 18% of GDP on healthcare related expenditures. Many experts believe that healthcare expenditures as a percentage of GDP will rise to nearly 20% by the year 2030. This will equate to roughly $4 trillion dollars being spent on healthcare related expenditures. This however is in stark contrast to actual healthcare outcomes which are not manifesting in the manner commensurate with the increase in costs. Currently, the United States is ranked last out of the 11 wealthiest nations of earth as it relates to healthcare outcomes. As a result, the United States is spending more than any other country but has the worst outcomes as compared to other developed nations. Chart 1 below showcases this large divide in both costs and outcomes. To help mitigate these issues, the healthcare industry should embrace and adult telehealth strategies within all health insurance coverage options. In addition, telehealth options should continue to be expanded to allows for a cost-effective solution that can simultaneously improve healthcare outcomes.

As it relates to the classical change theories, the empirical-rational theory emphasizes the belief in self-interest. Essentially, if the individual has a justified reason in changing their behavior, the individual will do so. This is a strong change theory that can be employed in costs as consumers, governments, and society at large has a vested interest in improving outcomes and lower costs. By lower costs, funds can be allocated to other important endeavors such as education or infrastructure. Here, both of these areas can provide much more benefits to the larger society than healthcare expenditures. Likewise, improving outcomes makes society more efficient with its operations. This ultimately helps to increase wealth, lower absenteeism, increase productivity, and ultimately improve the quality of life for all (Badham, 2012).

The normative-reeducation theory emphasizes cultural norm and values when making decision. Based on this theory, behaviors are changed once an individuals normative values and beliefs are changed. This change theory is not directly applicable to the healthcare changes described above. As it relates to healthcare costs, there isn’t a cultural aspect to it. Healthcare usage, in general however, does have large cultural ramifications. Here, many cultures do not welcome traditional healthcare treatment such as vaccines, medications, and surgery. These cultures often look more towards “natural” remedies while others simply pray to their “God” for healing of their pain or discomfort. As a result, this theory has an indirect impact on the changes described in the introduction but not a direct impact as it relates to costs (Beck, 1987).

The final change management theory is the power-coercive change theory. This theory attempts to use power and force to bring change to individual behaviors. Of the three theories, this occupies a middle ground in terms of application. In certain instances, healthcare costs can be “forced” upon the industry through regulations and other legislative action. However, legislation often creates a number of unintended consequences. For one, with cost caps, many services would ultimately be eliminated to maintain profitability, thus lowering consumer options. Cost caps could also create a need to lower headcount resulting in massive industry layoffs. Forcibly lowering costs can also lower overall healthcare quality as businesses look to eliminate expenses to help maintain profitability (Brotman, 1958).