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A New Leadership Model for the Struggling Operating Room

Posted by Dr. Tom Blasco on Feb 27, 2018 12:00:00 PM

Operating Room Leadership

The traditional operating room in the U.S. is a very complex organization with a large number of associated units.   It truly is a separate and distinct organization within a hospital.   It accounts for up to 2/3 of the hospital’s revenue and a large share of operating costs.  It’s filled with expensive technology, is ravenous for supplies, and requires highly trained (and expensive) professionals from a broad spectrum of specialties. Despite the costs of running today’s operating rooms, it remains, by far, the single most significant source for hospital profits.

The typical operating room staff working in their associate units are usually staffed by hourly employees with very defined work rules with lots of human resource department regulations.

Whether it is the Pre-Admission Testing Unit, Pre-op Holding, the OR, Sterile Processing or PACU, each staffed area is generally separate and siloed with unique issues and processes.  Typically, this universally common system structure is fraught with waste, redundancy and inconsistency. 

There are two major sources for this inefficiency and dysfunction:

  1. Payment Systems (both traditional and new) Drive Dysfunction and Competing Agendas. Payment for healthcare services has traditionally been fee for service (FFS).  Not being linked to outcome or efficiency, hospitals traditionally charged for care in a cost-plus pricing mode.  In most cases, either the government or private insurers has paid the bills; patients had very little exposure to cost. Up until recently, there has been very minimal effort to improve the value of services. During the past 10-years there has been aggressive payer moves to reduce the spiraling cost of US surgical care. Bundled payments and value-based reimbursements are now rapidly replacing FFS.  Ironically, these new payment systems have produced even more discord between hospital ORs and their customers; i.e., surgeons and patients.


  1. Surgeon and Operating Rooms: Two very different Agendas. For nearly one hundred years physicians and hospital have not acted in a mutually dependent or collaborative manner. Whether physicians are associated with a hospital as medical staff or faculty, physicians and administrations typically have very different agendas, often conflicting.  Most physicians (especially surgeons) have, at best, limited loyalty to the institution. Moreover, the often-used threat of, ‘I am going to take my patients to another institution’ illustrates the uneasy and fragile relationship between physicians and hospitals.  Although there is a significant countrywide trend of hospital physician employment, Surgical Directions has not seen much improvement in this long-standing problematic surgeon-administration relationship. 

So, most operating rooms have continued to provide excessively expensive care of with poorly documented or consistent quality.  Although there have been many efforts over recent years to improve outcomes and costs, only the relatively recent government-mandated effort to base payments on value rather than volume, is at last beginning to drive significant real change.  

Traditional surgical services ‘leadership’ has been relegated to the Director of Surgical Service.  This nurse director usually has wide-ranging responsibilities with limited authority and variable administration sponsorship or guidance.  This director may have some anesthesia department assistance with operational issues, but this is often inconsistent and not well defined.  Surgeons almost never take on leadership roles, other than in the usually ineffective medical staff or faculty sponsored surgery committee.  The administration usually functions in a crises management mode; responding to the most vocal physicians and staff; very unwilling to confront surgeon demands. This system’s lack of effective and collaborative leadership has been source the current OR’s issues.

The current paradigm of surgical services leadership is not working.  There are just too many siloed units and competing agendas.  Additionally, the organizational complexity is necessitating a new and unique kind of leadership model.

Surgical Services Executive Committee (SSEC):  Faced with these ongoing issues, many best practice hospitals are implementing a modified version of the successful ASC management model; i.e., a surgeon dominated leadership group that includes representatives from anesthesia, nursing and business management.  Given authority by the hospital’s administration, the SSEC becomes the ‘board of directors’ of surgical services.

Dominated by surgeons, with senior administration providing authority, the SSEC has administrative oversight over perioperative services. Using vetted analytics and a goal-directed agenda, focusing on the need for improved surgeon access and great patient care balanced with enhanced productivity and value of service, the SSEC can break down siloes while driving organizational transformation.

Should your operating room consider a Surgical Services Executive Committee?

Learn more about governance and engagement here:Perioperative Services: Where Engagement Equals Growth

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