How Bob McDonald can (really) fix the VA’s health care system by Steven Spear @FortuneMagazine August 8, 2014, 10:57 AM EDT E-mail Tweet Facebook Linkedin Share icons On Thursday, President Obama signed into law a $16.3 billion measure to help overhaul the Department of Veterans Affairs, an agency that in recent months has been plagued with criticisms for long wait times for health care and manipulation of records. While the extra funds are substantial and may be necessary for a system that serves some 8.5 million veterans each year, it won’t be enough to fix the problems at one of the nation’s largest health providers. Newly-confirmed Veterans Secretary Bob McDonald, a former CEO of Procter & Gamble PG , must create a new dynamic if the reforms are to succeed; he has to go beyond Congresses’ prescriptions and change the agency’s internal dynamics by focusing on what is measured, why it is measured, and what is done in response to the results. One of the reasons for the VA’s current crop of problems has to do with the way the VA measures performance. The metrics that former administrators focused on pushed people in the direction of highlighting (sometimes exaggerating) what was going right and playing down what was going wrong. Consequently, systemic problems — which might have been addressed early on before they caused harm — built up until they caused a crisis. It didn’t help that many of the metrics, such as wait times, were beyond the control and influence of the managers being evaluated, so there was even more incentive to game the system. To set things right, McDonald has to repurpose the VA’s metrics — using them to call out problems in their very earliest incarnation, so they can be addressed sooner and faster — before they have a chance to cause disruption. If this is done, then problematic situations can be swarmed rapidly and contained, with immediate investigation and diagnosis of what is going wrong and why, leading to better approaches that can be applied systemically. It might seem counterintuitive for people to be encouraged, even required, to call out problems, such as rising wait times, worrisome complications and infection rates, confusion with medications and referrals. But it really isn’t, since this models exactly the best behavior of healthcare clinicians. When a patient’s condition worsens, they execute a high-speed cycle of examination, diagnosis and treatment planning, so therapy can be immediately delivered. The same approach for managing the system through which care is delivered would have a profound effect. At early signs of something going wrong, a similar dynamic of experts — IT, HR, training, systems engineering — could do for the system what cardiologists, intensivists, nurses, and pharmacists do for patients: Swarm the situation, investigate the difficulty, identify causes for the problems, develop appropriate responses, and support staff in implementing new approaches. This advice is based on the long experience my colleagues and I have had helping organizations improve significantly their level of performance —large, technically complex organizations, many in healthcare including leading academic medical centers, and several VA sites already. Organizations that lack a constant and energetic concern for aberrations that impede staff and impact patients, customers and clients are precisely those who struggle endlessly. Those that display a borderline paranoia about seeing and solving small issues when and where they arise are those that are most successful at creating enormous value relative to the resources they consume and efforts they expend. In Pittsburgh, for example, healthcare providers mastered this dynamic of relentless betterment. The region as a whole cut the rate of a terrible complication — central line associated blood stream infections — by 70% with some hospitals driving the problem to zero. The Pittsburgh VA site was able to drive down the rate of surgical site infections in its nursing units to near zero. And this is not just a Pittsburgh phenomenon. In one initiative, a diverse set of VA sites increased quality, capacity and timeliness of care across the spectrum of screening, treatment, and follow-up for colorectal cancer. And other care providers around the country, such as Virginia Mason in Seattle, Thedacare in Appleton, WI and Beth Israel Medical Center in Boston, have improved care considerably by seeking out and responding to system difficulty quickly and often. McDonald is charged with moving a large system a long way so it can better serve the needs of those who depend on it. That is possible — it has been done elsewhere, elsewhere in healthcare, and elsewhere inside the VA. For this to happen on a large scale, McDonald needs to start by measuring what needs to be fixed and acting on those measures so the resources trusted to the VA are put to good and ever better use. Steven Spear is a senior lecturer at MIT Sloan School of Management and at the Engineering Systems Division at MIT. He is author of The High Velocity Edge.