1. Systems Theory

2. Objectives Students will be able to:
Describe systems theory and its components.
Construct a general systems model using inputs, throughputs and a feedback loop.
Construct a health care delivery system model.
Predict where and how factors such as cost, managed care, technology, and aging population, access to care, alternative therapies, and lifestyle behavior may affect various health delivery system models.
Predict outcomes as interconnected components of modified health care delivery systems using the same client procedures.
Design a system analysis process that evaluates the following outcomes: client satisfaction, productivity, cost effectiveness, and efficiency.
Analyze the cause and effect on health care system change based on the influence of technology epidemiology, bio-ethics, socioeconomic and various forms of complimentary medicine.

3. System Definition
A system is an orderly and complex arrangement of parts.

4. There are many types of systems:
Physiological Systems: The digestive system, neurological system, and circulatory system
Economic Systems: Capitalism and Socialism
Computer Systems: Network, mainframe, and PC computer systems

5. Systems Theory
A way of studying a system as one unit, instead of individual parts.
By examining a system as a whole, it is easier to understand how each part contributes to the overall mission

6. Systems, in general, have the following elements:
Input: Resources entering the system
Throughput: Work done on those resources used to produce a product
Output: The final product
Feedback: Information taken from the output to control or correct errors in throughput

7. System Components

8. Example of Payroll System
Input: Information entered on the number of hours worked and the pay rates of each employee.
Throughput: The work done by the computer to calculate the amount of pay, and the payroll taxes.

9. Example of Payroll System
Output: The paychecks and payroll reports.
Feedback: Check figures provided to show that the calculations were correct (number of employee paychecks processed, total payroll paid, etc.)

10. Systems Thinking
One approach to problem solving is systems thinking, or systems analysis.
It expands analysis to include the system as a whole, and the relationship of interconnected parts.
It recognizes that the whole is greater than the sum of the parts.

11. Backwards Thinking Systems thinking involves backwards thinking.
It begins with the end objective, and works backward, analyzing the relationship of each component to the final objective.

12. Example of Backward Thinking
If the objective of a team is to produce a low cost but high quality medical product, then backwards thinking would start with the final end product, then evaluate each input and throughput to see if:
It was necessary to the manufacture of the product
It increased quality
It reduced cost

13. Advantages of Systems Thinking
Is a global approach to problem solving
Helps employees “see the forest for the trees.”
Enables team members to understand the big picture.

14. Advantages of Systems Thinking
Focus: Systems thinking allows problem solvers to identify cause and effect relationships. It focuses on the activities necessary for change.
Effect
Cause

15. Advantages of Systems Thinking
Teambuilding: Systems thinking helps team members identify the objective of the team, and understand how their individual activities contribute to that objective.

16. The American Healthcare Delivery System
The American healthcare delivery system is one of the largest and most complex systems in the world.
We model it by adapting the generic system shown earlier.

17. The American Healthcare Delivery System

18. Let’s discuss each of the elements:

19. Input

20. Inputs
Human and financial resources
Patients

21. Human and Financial Resources
Human resources are the professionals who diagnose and treat patients, as well as the personnel who provide support services.
Human resources consist of the doctors, nurses, respiratory therapists, certified nurse assistants, administrators, dieticians, housekeepers, and accountants that work within the healthcare delivery system.

22. Patients
Patients are the individuals who enter the system for preventive, diagnostic, or treatment healthcare services.

23. Entry Point An efficient healthcare delivery system
must have a well defined entry point.

24. Entry Point
How does a 55 year old male with vertigo know where to enter the system?
An ambulance?
A general practice doctor?
A neurologist?
The emergency center?

25. A well-defined entry point provides:
Triage (screening to determine priority of treatment)
Timely entry into the system
Access to cost effective resources

26. Throughput

27. Throughput
Throughput is the step where the patient is treated

28. Resources Used in Throughput
Educational resources
Treatment resources
Financing mechanism
Management and control
Information and feedback systems

29. Educational Resources
Medical schools
Nursing schools
Public health education
Preventive healthcare education

30. Treatment Resources Doctors Nurses Hospitals Outpatient clinics
Well baby clinics
Etc.

31. What kind of services are provided in “throughput”?
Preventive - healthcare services designed to keep the student well
Diagnostic - healthcare services to find out what is wrong with the patient
Treatment - healthcare services to cure the patient

32. Financing Mechanism Someone has to pay the bill! Who pays?
The patients themselves (self-pay)
Employers
Private insurance companies
Medicare
Medicaid
The health insurance industry itself

33. Self-pay
Some patients pay for their own healthcare. These are the self-employed, uninsured employed, and the unemployed.

34. Employers
Many companies provide employee health insurance. The benefits vary widely. Most firms require that the employee pay a portion of the premium.
Almost all firms require cost sharing through co-payments at the time of service.
As healthcare costs continue to increase, it appears that the employee will pay a larger and larger percentage of total health insurance premiums.

35. Private Insurance
Some people purchase individual or family policies from health insurance carriers.
These are usually more costly than the group insurance contracts purchased by employers.
In addition, coverage is often limited, and some individuals are unable to qualify for coverage.

36. Medicare
Medicare is a federally funded program that pays for some healthcare products and services for those sixty-five years of age and older.

37. Medicaid
Medicaid is a state-funded program that pays for some healthcare products and services of the poor.
Benefits, and enrollment criteria vary dramatically from state to state.

38. The Healthcare Industry
Many healthcare providers, most specifically hospitals, are expected to provide charity care in return for non-profit exemption from income and property taxes.
Most hospitals also have large amounts of bad debt.
Many hospital emergency centers, for example, collect less than 50% of billings.
Ultimately, the consumer pays these costs.

39. National Health Insurance?
In future years, it is possible that the government will replace the many mechanisms currently used to pay for healthcare by some kind of universal financing mechanism.
What form this mechanism will take remains to be seen.

40. Management and Control Mechanisms
The American healthcare system has many management and control mechanisms.
These include private and public planning and regulatory agencies, licensure bodies, and legislative mandates.

41. Information Systems Control is ineffective without feedback.
Information systems include the financial and cost accounting systems used by hospitals and other healthcare organizations.

42. Output

43. Output is the product of the system.
How do you think we should define the product offered by the healthcare delivery system?

44. Possible Outputs A patient? A hospital admission? A patient day?
An individual service like an appendectomy?
A healthy community?
Some other definition?

45. The healthcare delivery system is like a mobile
Movement or pressure on one component exerts pressure on others.

46. Example
Successful pressure to reduce costs (one barrier to entry) will affect the volume of patients entering the system (input) and the number seen by the system (throughput).

47. Example
Greater volumes of patients entering the system (input) and being seen by the system (throughput) could cause the finance mechanism (another component of throughput) to flounder or fail.

48. Example
More resources spent for prevention will decrease resources needed for diagnosis and treatment, both components of throughput.

49. Summary
The healthcare industry is a complex system with many interrelated components. It is impossible to change one component of the system without influencing others. Some people have attempted to fix the American healthcare delivery system by focusing on one or more “broken components.” By failing to consider the “big picture,” they have often been met with unintended consequences. Those wishing to address problems of quality, cost, and accessibility must take a systems approach.

50. Discussion Question 1 System
Define the word “system” and give several examples of systems.
System

51. Definition
A system is an orderly and complex arrangement of parts.

52. Examples of systems:
Physiological Systems: The digestive system, neurological system, and circulatory system
Economic Systems: Capitalism and Socialism
Computer Systems: Network, mainframe, and PC computer systems

53. Discussion Question 2
What are the four components of a system?

54. System Components

55. Discussion Question 3
Explain what “backwards thinking” is as it relates to systems:

56. Backwards Thinking Systems thinking involves backwards thinking.
It begins with the end objective, and works backward, analyzing the relationship of each component to the final objective.

57. Discussion Question 4
The healthcare delivery system is like a mobile. Pressure or movement exerted on one component exerts pressure others.
Give an example:

58. Example
Successful pressure to reduce costs (one barrier to entry) will affect the volume of patients entering the system (input) and the number seen by the system (throughput).

59. Example
More resources spent for prevention will decrease resources needed for diagnosis and treatment, both components of throughput.

60. Example
More resources spent for prevention will decrease resources needed for diagnosis and treatment, both components of throughput.

61. Changes in Today’s Health Care Systems
Advances in technology
Epidemiology
Bio-ethics
Socioeconomics
Complementary (nontraditional) medicine

62. The End!