Providing a Business Case in Leadership Diversity Ebbin Dotson, Ph.D., M.H.S.A. Global Health and Cultural Competencies Global Health Education Consortium Conference April 5, 2009

40 Years of Moving Towards Culturally Competent Care Civil Rights Act of 1964 Surgeon General’s Healthy People Initiative 1979 (2000, 2010, 2020) 1985 Secretary of Health Margaret Heckler Report Institute of Medicine Reports

Civil Rights Act of 1964

Surgeon General’s Healthy People Initiative 1979 (2000, 2010, 2020)

1985 Secretary of Health Margaret Heckler Report

Institute of Medicine Reports

What Has 40 Years Taught Us? Health Disparities exist System will not fix itself Clinical awareness ≠ reductions Culturally Competent Organization Myth Financial investments = change???

Health Disparities exist

System will not fix itself

Clinical awareness ≠ reductions

Culturally Competent Organization Myth

Financial investments = change???

Differences, Disparities, and Discrimination: Populations with Equal Access to Healthcare Non-Minority Minority The Operation of Health Care Systems Discrimination: Biases, Stereotyping, and Uncertainty Clinical Appropriateness and Need Patient Preferences Quality of Health Care Health Care Disparity Populations with Equal Access to Health Care Gomes and McGuire, 2001 Difference

Clinical Appropriateness

and Need

Patient Preferences

Buy or Sell? Financial Pressures Clinically Unexplainable Quality Differences (Health Disparities) Population Demographic Shift Baby Boomer Retirement …Investment in Leadership Diversity

Financial Pressures

Clinically Unexplainable Quality Differences (Health Disparities)

Population Demographic Shift

Baby Boomer Retirement

…Investment in Leadership Diversity

Business Case for Leadership Diversity Defined as a business decision that is uniquely tied to an organization’s institutionalized practices, the business case for leadership diversity calls for executive leadership to: evaluate the influence of racial and ethnic diversity on decision-making, and strategically manage its effect for the benefit of the organization.

Defined as a business decision that is uniquely tied to an organization’s institutionalized practices, the business case for leadership diversity calls for executive leadership to:

evaluate the influence of racial and ethnic diversity on decision-making, and

strategically manage its effect for the benefit of the organization.

Research Aim To explore the relationship between the racial and ethnic diversity of hospital leadership and whether it impacts financial and quality outcomes of hospitals and the patients served

To explore the relationship between the racial and ethnic diversity of hospital leadership and whether it impacts financial and quality outcomes of hospitals and the patients served

Research Questions Is leadership diversity related to financial outcomes in hospitals? Is leadership diversity related to quality outcomes in the service population?

Is leadership diversity related to financial outcomes in hospitals?

Is leadership diversity related to quality outcomes in the service population?

Study Design Setting Integrated Health System Sample 24 Hospitals Period 2003-2007 Methods Time Series Cross Sectional Approach

Setting

Integrated Health System

Sample

24 Hospitals

Period

2003-2007

Methods

Time Series Cross Sectional Approach

Analytic Model Racial Concordance Leadership Diversity Financial Outcomes Quality Outcomes Patient Diversity

Diversity Categories Specified as Racial and Ethnic Diversity: African American (non-Hispanic Black) Asian or Pacific Islander European American (non-Hispanic White) Hispanic American (non-White Hispanic) African and Hispanic American Combined People of Color Combined

Specified as Racial and Ethnic Diversity:

African American (non-Hispanic Black)

Asian or Pacific Islander

European American (non-Hispanic White)

Hispanic American (non-White Hispanic)

African and Hispanic American Combined

People of Color Combined

Process Variables Leadership Diversity A percentage of the number of leaders at senior levels Patient Diversity A percentage of all patients served by the hospital Racial Concordance A percent ratio of racially concordant pairs of leadership and patient diversity

Leadership Diversity

A percentage of the number of leaders at senior levels

Patient Diversity

A percentage of all patients served by the hospital

Racial Concordance

A percent ratio of racially concordant pairs of leadership and patient diversity

Outcome Variable – Financial Success Discharges Annual volume of inpatient discharges

Discharges

Annual volume of inpatient discharges

Outcome Variable - Quality Acute Myocardial Infarction Composite Aspirin at arrival Aspirin prescribed at discharge Angiotensin converting enzyme inhibitor (ACEI) for left ventricular systolic dysfunction ( LVSD) Adult smoking cessation advice/counseling Beta blocker at arrival Beta blocker prescribed at discharge

Acute Myocardial Infarction Composite

Aspirin at arrival

Aspirin prescribed at discharge

Angiotensin converting enzyme inhibitor (ACEI) for left ventricular systolic dysfunction ( LVSD)

Adult smoking cessation advice/counseling

Beta blocker at arrival

Beta blocker prescribed at discharge

Outcome Variable - Quality Heart Failure Composite Discharge instructions Left ventrical function (LVF) assessment Angiotensin converting enzyme inhibitor (ACEI) for left ventricular systolic dysfunction ( LVSD) Adult smoking cessation advice/counseling

Heart Failure Composite

Discharge instructions

Left ventrical function (LVF) assessment

Angiotensin converting enzyme inhibitor (ACEI) for left ventricular systolic dysfunction ( LVSD)

Adult smoking cessation advice/counseling

Covariates Bed Size Average Length of Stay Medical Center Location Leadership Gender Years worked in Organization

Bed Size

Average Length of Stay

Medical Center Location

Leadership Gender

Years worked in Organization

Characteristics of the Sample Leadership Diversity = 34% People of Color Patient Diversity = 43% People of Color Bed Size = 271 Average Length of Stay = 3.83 days Leadership Gender = 22% Women Seniority = 13 years Annual Discharges = 16,310 AMI Composite = 88% HF Composite = 73%

Leadership Diversity = 34% People of Color

Patient Diversity = 43% People of Color

Bed Size = 271

Average Length of Stay = 3.83 days

Leadership Gender = 22% Women

Seniority = 13 years

Annual Discharges = 16,310

AMI Composite = 88%

HF Composite = 73%

Hypothesis Testing Hypothesis 1: Greater leadership diversity is negatively associated with discharges in a hospital. Hypothesis 2: Greater leadership diversity is positively associated with quality outcomes in a hospital.

Hypothesis 1:

Greater leadership diversity is negatively associated with discharges in a hospital.

Hypothesis 2:

Greater leadership diversity is positively associated with quality outcomes in a hospital.

Results – Financial Success Discharges African American -10023** Asian or Pacific Islander -8080** European American 6900** African and Hispanic American -7067* (*p<.10; **p<.05; ***p<.001)

Discharges

African American -10023**

Asian or Pacific Islander -8080**

European American 6900**

African and Hispanic American -7067*

Results – Financial Success Discharges Average Length of Stay -1164** Seniority 151** Region -3137** Bed Size 46*** (*p<.10; **p<.05; ***p<.001)

Discharges

Average Length of Stay -1164**

Seniority 151**

Region -3137**

Bed Size 46***

Results – Quality of Care Acute Myocardial Infarction Measure No main effect Heart Failure Measure No main effect

Acute Myocardial Infarction Measure

No main effect

Heart Failure Measure

No main effect

Discussion Mixed support for increasing leadership diversity Financial Implications Strategic Perspective Institutional Perspective Quality Implications Theory or Implementation Failure?

Mixed support for increasing leadership diversity

Financial Implications

Strategic Perspective

Institutional Perspective

Quality Implications

Theory or Implementation Failure?

Limitations Available Data Financial Success Patient and Quality Generalizability Sample size Specific to integrated health system

Available Data

Financial Success

Patient and Quality

Generalizability

Sample size

Specific to integrated health system

Research Contributions to Public Health Empirical support for investment in racial and ethnic diversity New avenue for cost implications (both savings and resource needs) New level of understanding factors associated with health disparities Enhancing pathway for cultural competence

Empirical support for investment in racial and ethnic diversity

New avenue for cost implications (both savings and resource needs)

New level of understanding factors associated with health disparities

Enhancing pathway for cultural competence

Future Research Expanding the potential of a managerial solution to health disparities Exploring how various organizational structures address health disparities Examining the return on investment of cultural programs

Expanding the potential of a managerial solution to health disparities

Exploring how various organizational structures address health disparities

Examining the return on investment of cultural programs

Questions

Organizational Performance Importance of Top-Down Leadership Linkage to Leadership Skills Environmental Constraints

Importance of Top-Down Leadership

Linkage to Leadership Skills

Environmental Constraints

Evidence of Diversity Performance Small firms with more culturally diverse work forces were found to have a greater positive percent change in revenue, net income, and CEO income than small firms with less culturally diverse work forces Hartenian and Gudmunson, 2000 Firms with top management teams composed of persons from different functional backgrounds experience more positive financial returns Korn, Milliken, and Lant, 1992 Educational training among top management team members has been shown to be positively related to return on investment and sales growth Smith et al., 1994

Small firms with more culturally diverse work forces were found to have a greater positive percent change in revenue, net income, and CEO income than small firms with less culturally diverse work forces

Hartenian and Gudmunson, 2000

Firms with top management teams composed of persons from different functional backgrounds experience more positive financial returns

Korn, Milliken, and Lant, 1992

Educational training among top management team members has been shown to be positively related to return on investment and sales growth

Smith et al., 1994

Evidence of Race-Based Quality Issues Heart Disease: Leading cause of death in US At the top of health disparities list Especially cardiac care Linked to many other illnesses Issues with access to cardiologists in medically underserved areas

Heart Disease:

Leading cause of death in US

At the top of health disparities list

Especially cardiac care

Linked to many other illnesses

Issues with access to cardiologists in medically underserved areas

Environmental Pressures Clinical Guidelines Changing Demographics Business Case for Leadership Diversity Business Case for Leadership Diversity Business Case for Leadership Diversity Cultural Competency Competition Increasing Costs Economy Technology Employers Reimbursement Workforce Shortages Retirement Diversity Technology Legal Governmental External Environment Internal Environment

Heart of the Matter Managerial Factors Health Disparities Social Determinants of Health Health Status Quality of Care