Systems Theory. Objectives Students will be able to: Students will be able to: Describe systems theory and its components. Describe systems theory and

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  • ObjectivesStudents will be able to:Describe systems theory and its components. Construct a general systems model using inputs, throughputs and a feedback loop. Construct a health care delivery system model. Predict where and how factors such as cost, managed care, technology, and aging population, access to care, alternative therapies, and lifestyle behavior may affect various health delivery system models. Predict outcomes as interconnected components of modified health care delivery systems using the same client procedures. Design a system analysis process that evaluates the following outcomes: client satisfaction, productivity, cost effectiveness, and efficiency. Analyze the cause and effect on health care system change based on the influence of technology epidemiology, bio-ethics, socioeconomic and various forms of complimentary medicine.

  • System DefinitionA system is an orderly and complex arrangement of parts.

  • There are many types of systems:Physiological Systems: The digestive system, neurological system, and circulatory system

    Economic Systems: Capitalism and Socialism

    Computer Systems: Network, mainframe, and PC computer systems

  • Systems Theory A way of studying a system as one unit, instead of individual parts.

    By examining a system as a whole, it is easier to understand how each part contributes to the overall mission

  • Systems, in general, have the following elements:Input: Resources entering the systemThroughput: Work done on those resources used to produce a productOutput: The final productFeedback: Information taken from the output to control or correct errors in throughput

  • System Components

  • Example of Payroll SystemInput: Information entered on the number of hours worked and the pay rates of each employee.

    Throughput: The work done by the computer to calculate the amount of pay, and the payroll taxes.

  • Example of Payroll SystemOutput: The paychecks and payroll reports.

    Feedback: Check figures provided to show that the calculations were correct (number of employee paychecks processed, total payroll paid, etc.)

  • Systems ThinkingOne approach to problem solving is systems thinking, or systems analysis.It expands analysis to include the system as a whole, and the relationship of interconnected parts.It recognizes that the whole is greater than the sum of the parts.

  • Backwards ThinkingSystems thinking involves backwards thinking.

    It begins with the end objective, and works backward, analyzing the relationship of each component to the final objective.

  • Example of Backward ThinkingIf the objective of a team is to produce a low cost but high quality medical product, then backwards thinking would start with the final end product, then evaluate each input and throughput to see if:

    It was necessary to the manufacture of the productIt increased qualityIt reduced cost

  • Advantages of Systems ThinkingIs a global approach to problem solvingHelps employees see the forest for the trees. Enables team members to understand the big picture.

  • Advantages of Systems ThinkingFocus: Systems thinking allows problem solvers to identify cause and effect relationships. It focuses on the activities necessary for change.


  • Advantages of Systems ThinkingTeambuilding: Systems thinking helps team members identify the objective of the team, and understand how their individual activities contribute to that objective.

  • The American Healthcare Delivery SystemThe American healthcare delivery system is one of the largest and most complex systems in the world.

    We model it by adapting the generic system shown earlier.

  • The American Healthcare Delivery System

  • Lets discuss each of the elements:

  • InputsHuman and financial resources


  • Human and Financial ResourcesHuman resources are the professionals who diagnose and treat patients, as well as the personnel who provide support services. Human resources consist of the doctors, nurses, respiratory therapists, certified nurse assistants, administrators, dieticians, housekeepers, and accountants that work within the healthcare delivery system.

  • PatientsPatients are the individuals who enter the system for preventive, diagnostic, or treatment healthcare services.

  • Entry Point An efficient healthcare delivery system must have a well defined entry point.

  • Entry PointHow does a 55 year old male with vertigo know where to enter the system?An ambulance?A general practice doctor?A neurologist?The emergency center?

  • A well-defined entry point provides:Triage (screening to determine priority of treatment)

    Timely entry into the system

    Access to cost effective resources

  • ThroughputThroughput is the step where the patient is treated

  • Resources Used in ThroughputEducational resourcesTreatment resourcesFinancing mechanismManagement and control Information and feedback systems

  • Educational ResourcesMedical schoolsNursing schoolsPublic health educationPreventive healthcare education

  • Treatment ResourcesDoctorsNursesHospitals Outpatient clinicsWell baby clinicsEtc.

  • What kind of services are provided in throughput?Preventive - healthcare services designed to keep the student well

    Diagnostic - healthcare services to find out what is wrong with the patient

    Treatment - healthcare services to cure the patient

  • Financing MechanismSomeone has to pay the bill!Who pays?The patients themselves (self-pay)EmployersPrivate insurance companiesMedicareMedicaidThe health insurance industry itself

  • Self-paySome patients pay for their own healthcare. These are the self-employed, uninsured employed, and the unemployed.

  • EmployersMany companies provide employee health insurance. The benefits vary widely. Most firms require that the employee pay a portion of the premium. Almost all firms require cost sharing through co-payments at the time of service. As healthcare costs continue to increase, it appears that the employee will pay a larger and larger percentage of total health insurance premiums.

  • Private InsuranceSome people purchase individual or family policies from health insurance carriers.

    These are usually more costly than the group insurance contracts purchased by employers. In addition, coverage is often limited, and some individuals are unable to qualify for coverage.

  • MedicareMedicare is a federally funded program that pays for some healthcare products and services for those sixty-five years of age and older.

  • MedicaidMedicaid is a state-funded program that pays for some healthcare products and services of the poor.

    Benefits, and enrollment criteria vary dramatically from state to state.

  • The Healthcare IndustryMany healthcare providers, most specifically hospitals, are expected to provide charity care in return for non-profit exemption from income and property taxes.

    Most hospitals also have large amounts of bad debt.

    Many hospital emergency centers, for example, collect less than 50% of billings. Ultimately, the consumer pays these costs.

  • National Health Insurance?In future years, it is possible that the government will replace the many mechanisms currently used to pay for healthcare by some kind of universal financing mechanism. What form this mechanism will take remains to be seen.

  • Management and Control MechanismsThe American healthcare system has many management and control mechanisms.

    These include private and public planning and regulatory agencies, licensure bodies, and legislative mandates.

  • Information SystemsControl is ineffective without feedback.

    Information systems include the financial and cost accounting systems used by hospitals and other healthcare organizations.

  • Output is the product of the system.How do you think we should define the product offered by the healthcare delivery system?

  • Possible OutputsA patient?A hospital admission?A patient day?An individual service like an appendectomy?A healthy community?Some other definition?

  • The healthcare delivery system is like a mobileMovement or pressure on one component exerts pressure on others.

  • ExampleSuccessful pressure to reduce costs (one barrier to entry) will affect the volume of patients entering the system (input) and the number seen by the system (throughput).

  • ExampleGreater volumes of patients entering the system (input) and being seen by the system (throughput) could cause the finance mechanism (another component of throughput) to flounder or fail.

  • ExampleMore resources spent for prevention will decrease resources needed for diagnosis and treatment, both components of throughput.

  • SummaryThe healthcare industry is a complex system with many interrelated components. It is impossible to change one component of the system without influencing others. Some people have attempted to fix the American healthcare delivery system by focusing on one or more broken components. By failing to consider the big picture, they have often been met with unintended consequences. Those wishing to address problems of quality, cost, and accessibility must take a systems approach.

  • Discussion Question 1Define the word system and give several examples of systems.

  • DefinitionA system is an orderly and complex arrangement of parts.

  • Examples of systems:Physiological Systems: The digestiv