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Management in Practice

Can a Hospital Be a Global Citizen?

Toronto’s Hospital for Sick Children has set itself the task of not only serving as a top clinical and research facility, but also disseminating knowledge throughout the world. Dr. Michael Apkon ’02, the hospital’s president and CEO, talks with Yale Insights about his role and the hospital’s global approach.

Q: You served in leadership roles at the Children’s Hospital of Philadelphia and Yale-New Haven Hospital before moving to Toronto. Do the big healthcare questions that we talk about in the United States about the value of care and incentives for doctors and patients look different in Canada?

In many ways it’s very similar, in the sense that everybody is trying to figure out how to create more value for the money and other investments that we’re making in healthcare. I’ve had the opportunity to work now in the States and Canada. I’ve also had the opportunity to consult through a few of my roles with healthcare organizations in other countries in the Gulf region, Africa, Asia, and Europe. And we’re all struggling with what I would call the universal truths. The costs are going up faster than our ability to pay. People expect more. They expect better, safer care and care that’s more patient-centered.

We’re all dealing with the very rapid pace of the evolution of medicine and the introduction of new technology and greater degrees of specialization, which are adding benefits but coming at the price of more complexity and more fragmentation. I think we’re all struggling with how we address those factors at the same time that we’re trying to address what we might call the triple aim in healthcare: better health for the population, lower cost per capita, and more effective encounters with the healthcare system. That macro dialog is playing out the same in every healthcare system that I’ve had the opportunity to explore. The language might vary a little bit but the move towards value in healthcare is familiar both in the U.S. and Canada now.

Q: Are the incentives better aligned in Canada, where there is a single-payer system?

The question is, aligned to what end? What I’ve come to recognize is that there’s no ideal system. There are elements that you’d like to extract from one system or another around the world but there’s no ideal system and every system has evolved for a specific purpose, through a specific historical path that is unique to that environment and is built around a set of tradeoffs.

So in the U.S., the system in some ways is built to allow people access to what they can afford to pay for and that provides a great deal of supply for healthcare services and a great deal of healthcare delivery at a relatively high cost per populace—but that cost per population is not equally distributed. People who have good insurance can use a lot if they so choose, and people who don’t have access to good insurance might have to cover costs out of pocket and tend to use less than they might need.

In Canada, this system is really founded in the principles of social justice. Everybody is expected to have access to a high-quality healthcare system and nobody is entitled to an advantage of better access to care or higher-quality care. That’s not to say that there’s not variation but the variation tends to be driven by geography or across organizations rather than by a patient’s ability to pay. Because the system is built around the principle of social justice, government needs to take a more significant role than in the U.S. Government has a limited ability to raise taxes and spend on healthcare, and therefore has built a system that more or less constrains the ceiling on what can get spent in the conventional healthcare system, and so that leads to a different set of tradeoffs. The U.S. does allow people incredible access to a large portfolio of services, assuming they can pay for it, whereas in Canada, because things are more constrained, you’re more likely to find yourself on a waiting list for things that might be more elective in nature.

Q: Do you think a hospital needs a physician in charge? What do you bring to the role that a non-physician wouldn’t?

I definitely don’t believe that a hospital needs to have a physician or a caregiver in the CEO role. I think being a bedside caregiver does provide a perspective that is valuable, but being a bedside caregiver is not the only way to get that perspective. I think people that have spent time working at the coal face of a healthcare organization, or the sharp end, however you want to think about it, can get that experience in a lot of ways. You can get it by volunteering and holding peoples’ hands in the waiting room or just paying attention to the experience that people—both patients and staff—are having within the system.

I do think that it’s really important for healthcare executives, wherever they are in the organization, to really have some sense of what it’s like at the interface of the families that we care for. I think it leads to a different calculus in decision making and I think it creates a different degree of genuineness in trying to lead an organization.

For me it’s been an interesting journey. I’m a physician executive, but if I think about the mindset that I bring to my work I can trace elements of it from each phase in my educational career.

My undergraduate degree is in engineering and, as an engineer, you’re taught to take the perspective of inside the black box looking out, and you think about system performance as a function of the elements that you’ve interconnected in the black box. It’s a very mechanical way of looking at the world but that explains things in terms of the fundamental components.

I was also trained as a scientist and really that’s a view from outside the black box looking in. It’s taking a perspective that the observations that we make have real explanations; you might not know how to explain them today but through experimentation you can figure it out. And it recognizes the importance of model-building to understand the world and the fact that our understanding at any one point in time is only a model that someday somebody’s going to add to or disprove. And that’s given me a perspective of questioning my understanding or other peoples’ understanding of the way the world works and approaching things from the standpoint that you’re only operating under a hypothesis that your actions are intended to test.

And I was trained as a physician and practiced as a physician and there I’ve both been inspired by the capabilities of modern medicine and what it can do but also frustrated by the things that—despite working at the cutting edge—you still can’t fix. Our system sometimes fails us as caregivers and as patients and we don’t deliver on the promise of modern medicine. And that’s influenced me a lot in my desire to work on the administrative side to try to make those systems better.

I also had the opportunity to train here at Yale SOM and get some formal training in management science, if you will. And that opened my eyes up to the fact that organizations and markets are really governed by almost biological systems that are less mechanical and more driven by complex, adaptive processes. That has added even more dimensions to the way I think about things.

On any given day, I’m drawing on the models I use to understand a new healthcare system or I’m thinking about operational redesign from the standpoint of the engineer or I’m trying to make decisions about investments with the perspective of a physician at the coal face of an organization. I’d like to think that that blend gives me an interesting perspective. I don’t think that that path is the only path, by any stretch of the imagination.

Q: Running a big academic medical facility, you’re balancing a number of priorities: patient care, training, research, financial performance. How do you define your objectives? Is there a formal mission statement and does that help with that process?

We do have a vision that embraces a tripartite mission around clinical care, education, and research, and that vision is “Healthier Children. A Better World.” Our orientation is to promoting healthier children through restoring patients to health, keeping them in health, and helping them accommodate and address ongoing illnesses or disabilities that they might have. It is hard to figure out what’s the overarching measure of success. Some hospitals will look at the bottom line and say, “Our overarching measure of success is the margin.” Others might look at it as market share. For me the simple measure, if you could actually quantify it in some way, is the number of kids that we restore or preserve in health.

We have to recognize that some of what we’re doing today isn’t having an impact on that today. The work that we’re doing in research has a long tail. Those investments that we’re making today will have an impact on children’s health long into the future but probably not for a number of years. Similarly, the investments that we make in our educational program have an impact today by creating more capability and richer patient care today, but the real benefit is that it creates the next 30 years’ worth of pediatricians and pediatric specialists. We have to have a time horizon that recognizes that some of the investments we’re making today take a long time to pay off.

The overarching orientation is towards addressing children’s health and having as broad an impact as possible and that’s driving us not only to think about the research and clinical and educational agendas in Toronto but also how we promote better pediatric care, how we aid with knowledge translation across venues that have less capability than we do, including in other parts of the world. We are one of the few children’s hospitals with a truly global footprint, working in knowledge translation and capacity development in Africa and in China and Europe and other parts of the world.

Q: That global view is not an obvious path for a hospital. You could imagine a hospital saying, “We want to do as much good as we can here in this city” or in the province or even nationally, but to explicitly aim at the whole world is ambitious. How did that come to be and what’s the thinking behind it?

It’s important that there are hospitals that are focusing on your neighborhood, and it’s important that there are hospitals that are focusing more broadly. In the pediatric world, there are a small number of places that have been able to amass the breadth and depth of capability that we have. Fortunately, kids are basically pretty healthy—they don’t need a lot of services. And yet it takes a lot of doing the same thing over and over to get really good at the highly specialized stuff that we do. And so what’s happened over time is that advanced pediatric care has become super-concentrated in a small number of places. Those places are able to advance the field even faster when they bring together the nexus of really elite research, education, and clinical programs.

The elite clinical programs are practicing right at the cutting edge; they’re delivering the best of what’s available but they’re also seeing what the limits of today’s care are because it’s beyond their capability. They’re able to work, directly through their own research or with colleagues in their own organization, to find really creative solutions to those problems and then they’re able to put them right back into testing and implementation within the same environment. And they’re then able to take their trainees and teach a group of people how to reliably put that new knowledge into practice.

It’s not possible for many organizations to be able to do that at the same level, because it takes a long time, it requires a lot of sustained investment, and it requires a commitment to being able to do both of those things at a really high level that most organizations just can’t make because they can’t get it funded or they just don’t have the right environment.

We’re very, very fortunate to be in an ecosystem that makes that possible, in a country that is among the most economically developed and well off in the world, in a province that has some of the best educational and healthcare institutions in the world, and in an environment that fosters the collaboration that is required to do that. But there are a lot of kids who are going to be cared for in environments that can’t do that, at least not by building it themselves—but they could get there with some help. And so we have felt that it’s an element of global social justice if you will to be able to help those places.

Part of why we have such a great talent pool is that we recruit from all over the world. So some of it is an ability to give back to parts of the world that have contributed to our own success. I also think it’s congruent with the Canadian government’s desire to provide economic development needed in different areas. In fact, some of our global efforts are tied to the Canadian federal government’s approach to building capability in Africa, as an example. Some of it is working with local stakeholders or governments that are really trying to do something transformational and have the resources to do that but don’t have the ability to marshal the expertise to get there on their own; for example, in Qatar we’ve really helped to elevate the pediatric capability. Doing that is consistent with our mission and our vision of “Healthier Children, A Better World.”

Medical care knows no political boundaries. The needs of children are the same whether they’re in economically deprived regions of the globe or war-torn conflict regions. And we have people with an intense interest driven by a sense of social justice and mission. We’ve got some unique abilities to help and where we can make that workable without compromising other things that we need to do, we’ve been very happy to help.

Q: Does that global work inform what you’re doing locally? Do your processes and your care in Toronto benefit from that approach?

I think it does benefit from that approach in a number of ways. First, we recruit people who are really talented who want to have that impact and it gives them an outlet for that. Second, it’s allowed us to build it into our research programs to try to learn, what are the things that impact children’s health worldwide, what are the strategies that might improve that? A third way that it’s helped is through reverse innovation, where we’ve worked in resource-poor areas and learned things that are directly applicable to transcending some of the geographic challenges in serving kids in Canada or in meeting the needs of less affluent parts of our province.

It has also been creating, I think, a greater capability, greater cultural sensitivity in our own workforce, who are having to think through how to translate knowledge to a different environment. That kind of lateral thinking really builds the capabilities that I want in my leadership team. So we take people that probably wouldn’t yet have that kind of opportunity in Toronto and we mentor them in an environment where they’re driving change in a very different environment and they build phenomenal skills that then are useful back in Toronto.