HEALTH SERVICES MANAGEMENT ETHICS

Health services management ethics encompass the myriad ethical issues, virtually all of which directly or indirectly affect clinical services, faced by the managers of organizations that deliver health services and the moral context in which these decisions are made. Health services managers plan, organize, control, direct, and staff health services organizations (HSOs) and lead, coordinate, and integrate their activities so that clinical care can be provided. In essence, by managing the HSO, managers provide the workshop and wherewithal that enable clients and patients to receive health services. These preventive, acute, restorative, and supportive services may be provided in and through a variety of organizational settings that include inpatient services, outpatient (clinic) care, and home health services. The most intensive or acute services are provided to hospitalized inpatients; the least acute are provided in the home and in hospice, where the emphasis is comfort care and pain control. The types of health services management ethical issues that arise in the various settings are similar and run a gamut that includes macro-level resource allocation, conflicts of interest, staffing levels, and providing the structure and support for patients and families as they decide whether to withhold or withdraw life-saving treatment.

Health services managers are commonly educated in professional masters degree programs where there is emphasis on the skills of business and the ethics of medicine. In other words, these programs socialize health service managers to understand that they are entering a field in which they manage a social enterprise with business dimensions, rather than a business enterprise with social dimensions. This fact in itself makes the HSO and those working in it unique and unlike any other type of service organization. The persons served by the HSO have a unique relationship with it. This relationship is expressed through a level of trust in the organization and implicitly in its management that is rarely found in the service industry.

Health Services Management as a Profession

Health services management was recognized as a distinct academic discipline in the early 1930s. This makes it a relative late-comer to a field including the long-established professions of medicine and nursing. In seeking professional status, health services managers have established and joined professional associations that, in turn, have developed and adopted codes of ethics. These vary in their level of proscription and prescription and the methods of enforcement, but all have the common thread of doing what is in the patient's best interest—usually as defined by the patient. The codes tend to emphasize beneficence, nonmaleficence, respect for persons (autonomy, truth-telling, fidelity, and confidentiality), and justice. Applying the ethical principles often used in clinical ethical decision making is sometimes strained, nevertheless they provide a useful starting point that is supplemented as needed by other principles.

A few states flirted with licensure of hospital administrators, but this appears to be a dead issue. In response to federal regulation that was stimulated by scandals in nursing homes, however, nursing home administrators are licensed in all states. Future scandals and abuses in the health services field likely will stimulate new government regulatory forays. As with state licensing of health professions such as medicine and nursing, regulation of HSO managers probably will include codification of ethical expectations.

It is noteworthy that managers in the health services field are often held to a higher standard than managers in business and other sectors of the economy. This may result in part from their association with the healing professions of medicine and nursing. It may also be a function of the notfor-profit tradition that is so dominant in the health services field. The higher standard also may arise from the expectation that none of those served by such an organization should have their trust breached—the trust inherent in the intimate, emotional, and vital relationship established in the process of delivering health services.

Personal Ethic

In addition to the guidance provided by the codes of ethics of professional associations, health services managers should develop a personal code of professional moral conduct—a personal ethic. Formal academic instruction in ethics is an expected part of graduate-level health services management education. Students enter health services management education with a moral framework developed from life experience, family environment, religious values, introspection, and self-study. The academic preparation in their professional education sensitizes them to the managerial and clinical ethical issues that they are likely to encounter and provides a framework for analysis and problem-solving ethical issues. Because of the pragmatic and applied nature of their work, health services management ethics tend to be normative and ask the question "What ought I (we) to do in this situation?"

Even with additional academic preparation, however, health services managers are likely to understate the importance of having a prospectively-developed, coherent, comprehensive, and consistent personal ethic. Their academic preparation is likely to give them a mind set that they can reason through and solve almost any problem that arises. While partially true, such an approach will not aid managers in anticipating ethical issues and prospectively working to prevent them or minimizing their effect when they arise. Lack of a personal ethic is likely to result in a relativistic approach to ethical problem solving, which is generally undesirable and certainly inconsistent with the value frameworks so ubiquitous in HSOs. It is difficult to overstate the importance of a well-developed personal value system.

Organizational Culture and Values

HSOs have mission and vision statements framed within the context of stated organizational values. The values identified reflect the culture of the organization; this implies that the organization's culture has been discovered. All organizations have a culture—the shared values that make each HSO unique. Rather than having discovered the culture and organized these discoveries into a mission statement, however, it is more typical that senior management developed a statement of values that they hold themselves or that they think should be the HSO's. The resulting organizational values statement may or may not reflect the culture of the HSO. Culture (and values) can be affected over time, but it is a slow, almost glacial process. Managers must beware of the trap of failing to model the organization's stated (desired) values, but asking of staff that which they are unwilling to do themselves. This will do naught but lead to cynical, noninvolved staff. Leading by example is essential.

The organization's values should be key to and provide the context for all HSO activities. These values must be the context in which staff are recruited, screened, and hired. Failure to measure candidates against the framework in which they will work invariably lead to mismatches of context and staff. The result will be higher costs and unnecessary and counterproductive levels of dissatisfaction, or worse. In terms of the HSO's services and how they are provided, its values should be inviolate. This is to say that, despite the demands of users, the organization can maintain its integrity only if it refuses to act in ways inconsistent with its values. It must be true to itself.

Questions arise as to the need for congruence between the organization's values and the personal ethic of staff, especially staff in management positions. Sectarian HSOs are likely to demand that senior leadership be adherents to their faith, a decision within the prerogatives of private organizations. It is more important, however, and often forgotten, that the values (personal ethic) of staff at all levels be congruent with the HSO's. Only by achieving a high level of congruence is the HSO able to live its values by developing a strong, pervasive culture. Managers may assume staff members have a tabula rasa or a generally compatible value system, and then must teach the HSO's culture tothem; the HSO's values must be reinforced by the actions of all, especially those in leadership positions. A strong culture, with clearly defined and shared values, will drive from it those whose interests and actions are contrary and this in itself is a worthy goal. High levels of cultural conformity do tend to stifle innovation, but this risk can be overcome in other ways, such as including innovation as an identified, important value in the culture.

Addressing Ethical Issues in the HSO

Health services managers have a multi-faceted role in preventing, identifying, and solving ethical problems. The importance of a personal ethic has been discussed. As a resource allocator, the health services manager is obligated to provide the support needed by the organization and its staff so that they are educated about ethics issues, have learned a methodology for addressing the ethical dimensions of management problems, and have the systems and procedures to support these efforts. Education about the HSO's values is an essential first step toward these goals; celebrating heroes of the culture and providing case examples are very useful. In addition, the manager is the driving force in ascertaining that the policies and procedures of the HSO address all of the areas where it is likely ethical problems will arise. For example, a comprehensive policy about accepting gratuities that is communicated to staff will go far to prevent conflicts of interest.

Ethics committees are required by institutional and programmatic accreditors and, thus, are ubiquitous in HSOs. Most commonly these committees are involved in clinical ethical issues and in this regard are charged with clinical case consultation, developing and reviewing clinical policies, and educating staff. Clinical staff tend to predominate on ethics committees, although social workers, clerics, and managers usually participate. Ethics committees are less likely to be involved in management ethics problems. Managers seem reluctant to allow ethics committee involvement in reviewing ethical implications of macro-resource allocation, for example. Support for ethics committees by management should include a modest budget, some staff assistance, and the prestige of recognizing their importance to the organization. Ethics committees commonly use ethicists as consultants.

Key Issues in Managerial Ethics

CONFLICTS OF INTEREST. Conflicts of interest arise when someone has two sets of duties or obligations and meeting one set makes it impossible to meet the other. They embody the biblical admonition against serving two masters. Whether a conflict of interest is present is fact-dependent, and accurate determination requires careful scrutiny. The potential for a conflict of interest does not necessarily mean that there is a conflict of interest. It is useful to distinguish differing interests that might lead to conflicts of interest from actual conflicts of interest. Even when differing interests are present it is possible to avoid actual conflicts of interest, but the slope is slippery.

Differing interests are present, for example, when an HSO manager has an ownership interest in a supplier that could service the HSO. If the manager approves purchases from that supplier at higher-than-market prices, a conflict of interest has occurred. However, if the price is lower than available elsewhere the differing interests continue, but no conflict of interest has occurred. In fact, the better pricing is an advantage to the HSO. However, if the manager uses the position of authority to cover up inadequacies in the supplies being provided, the differing interest has produced a conflict of interest.

All HSOs should have a policy defining conflicts of interest. Conflicts of interest can be avoided by disclosing the conflicting interest and recusing oneself from the decision. Using competitive bids also reduces the probability of conflicts of interest. Managers must avoid even the appearance of a conflict of interest. Few revelations are as devastating to one's moral leadership as the suggestion of improper gain from a position of authority. Health services managers, generally, are held to a higher standard than managers in the business sector, and the mere appearance of impropriety is considered more stringently than would be the same activity if performed in another enterprise.

CONSENT. Although it is commonly considered a purely clinical ethics issue, consent is an issue that should concern the HSO manager. If it is to operationalize the patient's autonomy, the HSO must assure itself that the patient has been adequately informed as to the services that are to be rendered under its auspices. The legal requirement is that the physician obtain the patient's consent after explaining benefits, risks, and alternatives to the services that are to be rendered. However, the HSO should have policies and procedures that involve nursing or other appropriate clinical staff in ascertaining that the patient adequately understands what is happening. The manager is obliged to recognize that assuring the adequacy of consent is important; establishing the means by which it can be done and providing the staffing will make it a reality.

RESOURCE ALLOCATION. Resource allocation in HSOs occurs at the macro and micro level. The macro level includes new plant, capital equipment, and services. These decisions have major resource implications for the HSO. In turn, macroallocation decisions have major implications on the microallocation decisions made by clinicians. For example, a decision not to expand the intensive care unit (ICU) (macroallocation) means that decisions about individual patients (microallocation) will be constrained by the number of ICU beds. This, in turn, may mean that patients who might benefit from ICU services may be unable to readily receive them. Macroallocation decisions invariably have clinical implications, whether direct or indirect, and successful managers involve physicians in making these decisions. Nevertheless, resource constraints mean that not all that is clinically desirable is available.

RESOURCE CONSTRAINTS. Concomitant with ethical issues of macroallocation is the problem of resource constraints. Reimbursement from all funding sources is increasingly sparse. Most HSOs are barely achieving a modest surplus; many are running deficits. This change has occurred because of the dramatic funding reductions that began in the 1980s, after the halcyon days of the 1960s and 1970s. It is likely that the problem of inadequate reimbursement will continue unabated as patients demand more from HSOs and third-party payers are increasingly unwilling to pay at adequate levels and in a timely manner.

STAFFING. Severe shortages of several health professions plague HSOs. Registered nurses have received the most attention, although other health professions such as pharmacists and imaging technologists have also attracted too few. In addition, it has been projected that the emphasis on primary care in the 1980s and 1990s will result in too few physicians in some procedure-based specialties in the twenty-first century. HSOs have responded to nursing shortages by reducing the ratio of registered nurses to other types of staff who provide direct care to patients and instituting tuition benefits programs to encourage staff to enter nursing. Although health services managers and HSO trade associations assert that these shortages have not led to a diminution in quality of care, it stands to reason that doing more with less will eventually affect quality negatively, thus raising questions of beneficence and nonmaleficence.

COSTS. As the costs of providing health services continue to climb at double the rate of inflation in the general economy, and as the rate of reimbursement declines, the health services manager is caught in a double squeeze. Higher costs mean that more resources must go into providing basic services, and there is less capital for new equipment, programs, services, and innovation. This further exacerbates the resource allocation issue discussed above.

QUALITY OF CARE. It is estimated by researchers and quality improvement experts that 30 percent of the costs of providing a good or service occurs because of waste, delay, and rework. Such costs in the HSO setting are even more significant because to them must be added the discomfort, pain, morbidity, and mortality that can occur. The HSO manager has an ethical obligation to undertake quality improvement throughout the organization in all of the many clinical and administrative processes.

CLINICAL ETHICS ISSUES. Managers must assure that clinical staff have the support needed to prevent, minimize, and solve clinical ethical issues that arise. In addition, managers must be aware of clinical ethics issues that arise and make changes and improvement in the support available. Managers are expected to participate in ethics committees and institute and participate in ethics grand rounds in the HSO. Only by such hands-on involvement can the manager be aware of failings and issues that arise in the HSO.

The Future

The future promises to be even more challenging to health services managers than the past has been. The types of problems noted above are likely to continue, both in their present forms and in new permutations. New or exacerbated problem areas include terminal illness and futility care, advance directives, serving the underserved, marginal practitioners, multiculturalism (especially the differing meanings of life, death, disease, and treatment held by American subcultures), corporate compliance, employment practices, and whistleblowing. Three of these areas are noteworthy.

FUTILITY CARE. Futility care has been discussed since the early 1990s, but remains inadequately addressed. Acute care hospitals face families (and, less often, patients) who demand that care offering no hope of benefit be continued. Fear of legal action and bad publicity have prevented hospitals from acting to withhold or withdraw services in such situations.

MULTICULTURALISM. Effectiveness in a multicultural society requires that the HSO's values are clearly communicated to patients, lest the HSO be pulled in many directions with inconsistent demands. Patient interests must be accommodated when possible, but not in contravention of the organization's values.

CORPORATE COMPLIANCE. Corporate compliance is the hot button issue of the new millennium. An organization whose culture and values include honesty, respect, and fair dealing will require little attention to corporate compliance, even though compliance officers are mandated by law. Its values already encourage staff to act honestly. Managers must assure that the organization's culture has no incentives for staff to do otherwise.

Conculsion

Health services managers face a future paradoxically marked by a bleak economic outlook and a challenging, hopeful outlook for providing services. Even as they endeavor to bring high quality health services to all who need them, health services managers will have to do so with fewer resources and under heavier constraints then ever in the profession's history.

kurt darr

SEE ALSO: Corporate Compliance; Hospital, Contemporary Ethical Problems of; Medicaid; Medicare; Mental Health Services; Mergers and Acquisitions; Organizational Ethics in Healthcare; Pharmaceutical Industry; Profit and Commercialism

BIBLIOGRAPHY

Beauchamp, Tom L., and Walters, LeRoy, eds. 1999. Contemporary Issues in Bioethics, 5th edition. Belmont, CA: Wadsworth Publishing Company.

Boatright, John R. 2003. Ethics and the Conduct of Business, 4th edition. Upper Saddle River, New Jersey: Prentice Hall.

Darr, Kurt. 1997. Ethics in Health Services Management, 3rd edition. Baltimore: Health Professions Press.

Hall, Robert T. 2000. An Introduction to Healthcare Organizational Ethics. New York: Oxford University Press.

Pellegrino, Edmund D., and Thomasma, David C. 1988. For the Patient's Good: The Restoration of Beneficence in Health Care. New York: Oxford University Press.