Healthcare Quarterly

Healthcare Quarterly 10(1) January 2007 : 97-97.doi:10.12927/hcq.2007.18662
Longwoods Review

The Search for Continuously Improving Financial Performance Indicators: The Hospital Report Research Collaborative Approach

Bruce A. Boissonnault


The first lesson that you must learn is, when I call for statistics about the rate of infant mortality, what I want is proof that fewer babies died when I was Prime Minister than when anyone else was Prime Minister. That is a political statistic.

- Winston Churchill 1874-1965

The worst statistics for public policy are selected because they support a predetermined policy position. The best are those that accurately reflect the situation and that provide clues to how we can improve that situation. As healthcare measurement systems evolve, conscious and deliberate steps are required to ensure that our best statistics do not become our worst, and that our systems of measurement continuously improve in step with our systems of care.  

In their article titled "Selection of Key Financial Indicators: A Literature, Panel and Survey Approach," Pink et al. describe the approach used by the Hospital Report Research Collaborative (HRRC) to update the key financial indicators included in the 2005-2006 Hospital Report, which first was published in 1998. Fundamental to the HRRC's approach is the assumption that transparency and thoughtful aggregation of comparative performance measures can help drive continuous quality improvement (CQI) and better fiscal policy in healthcare.

CQI often refers to a central element of renowned quality expert W. Edwards Deming's philosophy, which was summarized by some of his Japanese proponents in the 1970s as follows: When people and organizations focus primarily on quality (i.e., quality = results of work efforts/total costs), then quality increases and costs fall over time. However, when people and organizations focus primarily on cost, then costs rise and quality falls over time (W. Edwards Demming 2006). Thus, effective fiscal policy is inseparable from effective CQI as recognized by the HRRC's use of a balanced scorecard model in the Hospital Report.

The HRRC approach has several advantages that can help ensure that the Hospital Report remains in step with the systems of care it measures. The approach is flexible and can address various types of financial and quality indicators, as well as the frameworks supporting them. It is transparent, thereby reducing the likelihood of undue influence by any single group or special interest. It is scalable and could be used by other regions if such transparent reports were to be expanded across Canada. It could be used to identify possible measurement collaborations with groups of hospitals outside of Canada. It ensures consideration of many new and divergent indicators. And it affords an effective convergence mechanism to select the final set of indicators. Thus, the approach charts a path that synthesizes (1) an immense body of academic and practical literature, (2) a broad base of hospital experience and (3) input from a diverse panel of financial experts.  

In the final analysis, the most important legacy of the HRRC's literature, panel and survey approach may not be its one-time impact on Hospital Report.

About the Author(s)

Bruce Boissonnault is President and CEO of Niagara Health Quality Coalition and Publisher of New York Sate Hospital Report Card.


W. Edwards Demming. 2006. Wikipedia. Retrieved November 10, 2006. Edwards_Deming#Deming_philosophy_synopsis.


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