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Sunday, November 4th 2012

What Healthcare Can Take From Other Industries

As with everything Dr. Atul Gawande writes nowadays, his recent piece in The New Yorker has drawn some attention. In it Dr. Gawande asks what medicine can take from the efficiency and mass produced quality of chain restaurants, specifically The Cheesecake Factory restaurant.

Big chains thrive because they provide goods and services of greater variety, better quality, and lower cost than would otherwise be available. Size is the key. It gives them buying power, lets them centralize common functions, and allows them to adopt and diffuse innovations faster than they could if they were a bunch of small, independent operations. Such advantages have made Walmart the most successful retailer on earth. Pizza Hut alone runs one in eight pizza restaurants in the country. The Cheesecake Factory’s major competitor, Darden, owns Olive Garden, LongHorn Steakhouse, Red Lobster, and the Capital Grille; it has more than two thousand restaurants across the country and employs more than a hundred and eighty thousand people. We can bristle at the idea of chains and mass production, with their homogeneity, predictability, and constant genuflection to the value-for-money god. Then you spend a bad night in a “quaint” “one of a kind” bed-and-breakfast that turns out to have a manic, halitoxic innkeeper who can’t keep the hot water running, and it’s right back to the Hyatt.

Medicine, though, had held out against the trend. Physicians were always predominantly self-employed, working alone or in small private-practice groups. American hospitals tended to be community-based.


Historically, doctors have been paid for services, not results. In the eighteenth century B.C., Hammurabi’s code instructed that a surgeon be paid ten shekels of silver every time he performed a procedure for a patrician—opening an abscess or treating a cataract with his bronze lancet. It also instructed that if the patient should die or lose an eye, the surgeon’s hands be cut off. Apparently, the Mesopotamian surgeons’ lobby got this results clause dropped. Since then, we’ve generally been paid for what we do, whatever happens. The consequence is the system we have, with plenty of individual transactions—procedures, tests, specialist consultations—and uncertain attention to how the patient ultimately fares.


To most of us who work in health care, throwing a bunch of administrators and accountants into the mix seems unlikely to help. Good medicine can’t be reduced to a recipe.

Then again neither can good food: every dish involves attention to detail and individual adjustments that require human judgment. Yet, some chains manage to achieve good, consistent results thousands of times a day across the entire country.

In likewise fashion Sully Sullenberger, the US Airways captain who landed flight 1549 in the Hudson, has been making the rounds talking about how ideas from the airline industry can improve patient safety. Here is the proposal he has signed on in full (PDF).

The homogeneity and economies of scale improving health care efficiency and safety. And there’s something to that, so I feel bad knocking it but I doubt about the ability to standardize health care. There’s much to some of the examples Dr. Gawande gives, including standardizing operations; I’ll make only sarcastic mention, and ignore otherwise, that standardizing implants to reduce costs has the potential to reduce new entrants and innovations within that sphere of biotechnology. But other suggestions in Dr. Gawande’s work raise more eyebrows. We’re already seeing how little patients choose to use quality data readily available to them. THe vast majority of patients simply use just as much data, and the same type of data, in choosing a physician or a hospital as they do choosing a restaurant.

And as an op/ed in The Boston Globe notes, the efficiency of The Cheesecake Factory has some costs.

While the Cheesecake Factory may have developed a highly efficient and thus profitable business model, it seems to be one based on punitive labor practices. In California, Cheesecake Factory workers won a $4.5 million settlement with the chain for its widespread wage and hour law violations. It appears that the chain has not learned its lesson: A law firm in Tennesee is pursuing litigation on behalf of current and former servers at the chain. The complaint alleges that all across the country Cheesecake Factory servers have worked hours for which they have not been compensated or for which they have been paid “at rates less than one-and-one-half times their normal hourly rates, and/or for which they were paid below the minimum wage.”

Because of its continuing deficiencies in this area, the Restaurant Opportunities Centers (ROC), a nationwide restaurant workers group, gave the chain a very low rating in its 2012 “Diners’ Guide” to ethical eating. The guide named the Cheesecake Factory as one of the worst employers in the industry.


It is hard to consider the Cheesecake Factory’s record of process innovation while divorcing it from its product. Dr. Gawande, who has written about the costs of obesity-linked cardiac problems in some of his other writings, does acknowledge that the food at the Cheesecake Factory, ” was sweeter, fatter and bigger than it had to be.” At the same time, he lauds the chain for providing “goods and services of greater variety, better quality, and lower cost than would otherwise be available.”

There’s something to be said for checklists and standardizing processes but medicine isn’t the airline industry and it isn’t The Cheesecake Factory and changes towards making it more like such aren’t necessarily for the best, or more importantly, even in the best interests of patients.