The Cambridge textbook of bioethics

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implications, and (iii) ethical issues related specifically to the business aspects of healthcare organizations. The goals of organizational ethics are to achieve a strong alignment between the organization’s stated mission, vision, and values and the decisions and actions by individuals on behalf of the organization (Silverman, 2000) and to create an organizational climate where organizational ethics issues can be constructively addressed (Spencer et al., 2000).

Why is organizational ethics important?

Ethics

Organizational ethics involves ‘‘the intentional use of values in [organizational] decision-making’’ (Potter, 1996, p. 4). Winkler et al. (2005) proposed four substantive principles of organizational ethics to guide decision making based on values inherent to the organization’s relationships with key stakeholders (Table 32.1). Other values have also been argued to be important for creating an ethical organization: humaneness, reciprocal benefit, trust, gratitude, dignity, service, and stewardship (Reiser, 1994). Trust has been emphasized by several authors as a key to organizational ethics effectiveness in healthcare organizations (Buchanan, 2000; Goold, 2001; Pearson et al., 2003). These and other values are often articulated in an organization’s mission/ vision/value statements, code of ethics, policies, and staff orientation and performance evaluation processes. Ethical decision-making processes are also essential to organizational ethics. Organizational decision making is often fraught with moral uncertainty about what ought to be done in the context of competing stakeholder interests, conflicting values, and limited information. Ethical decisionmaking processes help to establish the ethical legitimacy of organizational decisions by facilitating agreement around how decisions ought to be made. Key procedural values include openness, transparency, inclusiveness, empowerment, and reciprocal accountability (Buchanan, 2000; Emanuel, 2000;

Silverman, 2000; Spencer et al., 2000; Boyle et al., 2001; Gibson, et al., 2005a). Ethical processes are important for establishing institutional trust and promoting constructive stakeholder engagement around organizational decisions (Goold, 2001; Gibson et al., 2005b). Although an organizational decision may not favor a stakeholder’s interests, the stakeholder may nevertheless be able to accept the decision if the decision-making process is (and is perceived to be) ethical. One prominent process model is Daniels and Sabin’s (2002) accountability for reasonableness framework which is described in detail in ch. 33. described. When integrated into organizational mechanisms and structures, these substantive and procedural values can contribute to the establishment of a strong ethical climate and culture in the organization (Emanuel, 2000; Silverman, 2000; Spencer et al., 2000; Boyle, et al., 2001).

The field of business ethics offers additional concepts and tools to address the business aspects of healthcare, the importance of collective responsibility for mission fulfillment, and the unique value-creating activity of organizations as compared with individuals (Spencer et al., 2000; Ells and MacDonald, 2002). For example, ‘‘stakeholder impact analysis’’ involves identifying all stakeholder groups and interests, ranking and weighting the stakeholders and their interests, and assessing the impact of a proposed action on each stakeholder group (Brooks, 2004). Several bioethicists have proposed stakeholder impact analysis as a tool to facilitate organizational ethics decision making in healthcare organizations (Hall, 2000; Spencer et al., 2000; Werhane, 2000; Boyle et al., 2001; Ells and MacDonald, 2002).

Law

Healthcare organizations are legal entities with corresponding rights and responsibilities defined by a range of common and civil law provisions. Although the specific legal responsibilities of healthcare organizations may differ from one jurisdiction to the next, common domains of legal responsibility include employment standards (e.g., occupational

health and safety standards, human rights provisions), consumer protections, corporate governance requirements, tax regulations, privacy legislation, and so on. Faith-based healthcare organizations may have additional responsibilities defined by canon law related to the religious mission of the sponsoring organization (National Conference of Catholic Bishops, 1995; Catholic Health Corporation of Ontario, 2000).

Healthcare organizations can be held legally liable for decisions made on their behalf. For example, in

Darling v. Charleston Community Memorial Hospital

(1965), the US court ruled that hospitals and their governing bodies have a direct duty of care for patients and can be held liable for injury resulting from negligent supervision of medical staff. The doctrine of corporate negligence holds that ‘‘a hospital has a direct and independent responsibility to its patients over and above that of the physicians and surgeons participating therein’’ ( Johnson v.

Misericordia Community Hospital, 1981). The common law finding defines clinicians and administrators (including Board members) as legal cofiduciaries of patient care.

The law recognizes that an organization cannot control every action taken by an individual associated with it. However, the law expects healthcare organizations to act in good faith and to make reasonable efforts to create a workplace environment where illegal action is prohibited (Seay, 2004). Many healthcare organizations have instituted

corporate compliance programs, which are designed to mitigate organizational culpability through the implementation of strategies to prevent and detect illegal behavior, take corrective action in the case of a legal violation, and enforce compliance with legal standards among staff (Boyle et al., 2001; Pearson et al., 2003). However, recent corporate governance scandals (e.g., Enron) suggest that corporate compliance programs may not be sufficient alone to mitigate organizational culpability or to ensure corporate ethical conduct. As a result, some healthcare associations have developed education programs and policy guidance to clarify the legal and ethical obligations of corporate governance in healthcare organizations (Corbett and MacKay, 2005.)

Policy

With the advent of managed care in the USA and fiscal constraints elsewhere, concerns have been raised about the encroachment of financial considerations in patient care (Silverman, 2000; Pearson et al., 2003). In 1994, the US Joint Commission for Accreditation of Healthcare Organizations incorporated organizational ethics into its accreditation standards (Joint Commission on Accreditation of Healthcare Organizations, 2006). Other accreditation bodies have followed suit (Canadian Council for Health Services Accreditation, 2004). In addition to requiring ethics in the delivery of direct patient care,

246J. L. Gibson et al.

accredited healthcare organizations are expected to include ethical considerations in decision making (e.g., resource allocation, risk management, human resource management), to develop mechanisms to address ethical issues as they emerge, and to align organizational decisions with the organization’s mission and values (Joint Commission for International Accreditation, 2002; Canadian Council for Health Services Accreditation, 2004; Joint Commission on Accreditation of Healthcare Organizations, 2006).

Professional codes of ethics specify the ethical obligations of health services managers to patients, the organization, and the community (American College of Health Executives, 2003; Veteran’s Health Administration, 2003; Canadian College of Health Service Executives, 2005; General Medical Council, 2006). In Canada, for example, an ethical healthcare executive ‘‘services the public interest in an ethical fashion, strives to provide quality services, communicates truthfully and avoids misleading or raising unreasonable expectations in others, uses sound management practices and ethical use of resources, promotes public understanding of health and health services, and conducts inter-organisational activities in a cooperative way that improves community health’’ (Canadian Council for Health Services Accr-

editation, 2004). There is an emerging consensus within the health sector that clinicians and managers are both accountable for the care and safety of patients (Bishop et al., 1999; Chervenak and McCullough, 2003). The Australian Medical Association’s Code of Conduct for Corporations Involved in the Provision of Management and Administrative Services in Medical Centers in Australia offers a concrete attempt to clarify this shared accountability (Australian Medical Association, 2001).

Clinician–managers may experience unique ethical challenges in situations where their ethical obligations as clinicians may conflict with their ethical obligations as managers, for example, providing high-quality care to individual patients versus ensuring high-quality care within available resources for the populations of patients served by the organization. In recent years, a number of

professional organizations have developed specific policies in an effort to guide clinician–managers (Ozar et al., 2000; Canadian Nursing Association, 2002; General Medical Council, 2006).

Empirical studies

Empirical studies of organizational ethics are limited. The vast majority of empirical research has focused on a single organizational ethics issue: resource allocation. Studies of institution-level resource allocation in hospitals and health authorities have highlighted the importance of fair decision-making processes to resolve these challenges (Hope et al., 1998; Ham, 1999; Daniels and Sabin, 2002; Martin, et al., 2003; Peacock et al., 2006). Failure to resolve the tension between managing economic constraints and providing high-quality service was identified by nurses as the most pressing organizational ethics issue in their workplace (Cooper, et al., 2002, 2004).

Recent studies of organizational ethics in healthcare organizations highlight a number of other key organizational ethics issues. Pearson et al. (2003) identified six domains of organizational ethics issues in managed care organizations based on interviews with senior executives and physicians: confidentiality, community benefits, vulnerable populations, medical necessity and appropriateness, end of life care, and consumer empowerment. A Canadian study found that clinician–managers faced ethical issues related to resource allocation, workplace safety, intraprofessional and interprofessional conflict, conflict of interest, and balancing the competing needs of the patient, the community, and the organization (Lemieux-Charles et al., 1993; see also Sibbald and Lazar, 2005).

The ethical climate of the organization has been shown to be a significant factor in nurses’ decisions to leave their positions or the nursing profession (Hart, 2005) and in nurses’ self-reports of moral distress and burnout (Corley, 1995; Severinsson, 2003; Corley et al., 2005). Perceived organizational fairness is associated with increased quality of care ratings, job satisfaction, and trust of management as well as decreased emotional exhaustion among

nurses (Aiken et al., 2001; Laschinger, 2004), while perceptions of unfairness are correlated with increased psychological distress among physicians (Sutinen et al., 2002) and increased absenteeism among hospital staff generally (Kivimaki et al., 2003).

How should I approach organizational ethics in practice?

Organizational ethics effectiveness depends on, firstly, knowing what ethical issues your organization is facing, and secondly, ensuring there are effective mechanisms in place to address these issues. In 2005, we interviewed 150 Board members, senior executives, clinical and administrative managers, and senior clinical leaders in 13 publicly funded healthcare organizations in Toronto, Canada to find out what ethical issues their organizations were facing and what strategies were being used to address them. The key ethical issues and strategies are summarized in Table 32.2 and these serve as a good ‘‘roadmap’’ for approaching organizational ethics in practice.

Organizational ethics effectiveness is reflected in the degree to which an organization’s stated mission and values are expressed in the choices and actions of the organization’s agents, including staff, managers, and board members. Ethical guidelines, policies, and decision-making frameworks are important mechanisms for realizing the organization’s mission and values, guiding ethical conduct, and resolving value conflicts. However, experience shows that ethical leadership from the board and senior management, including senior clinical leaders, is important for setting the ethical tone of an organization (Spencer et al., 2000; MacRae et al., 2005). Each of the 13 organizations we surveyed had at least one full-time ethicist, who provided expert leadership in ethics. The ethicist can play a key role in helping to resolve organizational ethics issues as well as building ethics capacity across the organization through staff education and policy development (Godkin et al., 2005). Given the complexity of many organizational ethics issues,

consultation with affected stakeholders is a key strategy for clarifying the impact of alternative organizational decisions. Finally, the effectiveness of organizational ethics requires evaluation of these strategies to ensure that organizational decisions reflect the organization’s stated mission and values, individual actions of staff embody these values, organizational ethics issues are identified and resolved constructively, and together these actions contribute to a positive ethical climate.

The cases

The Clinical Operations Committee is faced with determining whether or not the proposed business opportunity is consistent with the mission and values of the organization. The financial benefits of the commercial partnership would certainly generate revenue to support clinical programs. However, these benefits may undermine the patient care mission, particularly in the eyes of stakeholders. The Clinical Operations Committee should engage in a candid and cooperative discussion with the senior management team about alternative solutions to address the funding gap. Funding alternatives should be assessed on the basis of the organization’s mission and values, their impact on key stakeholder groups, and other relevant factors (e.g., clinical data, legal considerations, professional obligations). If the organization does not already have a policy guiding business development decision making, a key recommendation of the Clinical Operations Committee should be that the organization should develop such a policy, based on broad range of stakeholder input, which outlines explicit criteria and processes for making business-development decisions and includes an evaluation component.

Healthcare professionals have an ethical obligation to advocate for their patients. However, they should also be good stewards of societal resources. A physician’s professional autonomy allows for the physician to donate his or her services, but it does not necessarily give the physician the authority to

donate hospital resources such as medical devices and costly medication. These dual obligations may create a conflict for the healthcare professional involved in the care of Mr. A. The healthcare professional can fulfill both obligations by bringing Mr. A’s case forward to the decision makers within the organization who are directly responsible for allocating hospital resources. Decision makers should consider (i) the gravity of Mr. A’s clinical and financial need, (ii) the impact on other stakeholder groups (e.g., access to care), (iii) the professional obligations of the healthcare professional, and (iv) the mission and values of the healthcare organization. Consultation with an ethicist may facilitate decision making in this case. Although availability of resources may be a limiting factor on the ability of an organization to provide the surgery to treat Mr. A, it may be possible to fulfill the hospital’s patient care mission and the healthcare professional’s obligations in other ways, for example by securing access to care for Mr. A through another provider or by seeking alternative funding sources. As in the previous case, an organizational policy would be helpful to guide decision making in future cases.

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Dr. B is on the seventh day of his rotation as medical director of the intensive care unit (ICU) when he receives a referral call about a patient in emergency who needs ICU admission for ventilation support. Dr. B examines his ICU census and notes that not only are there no ICU beds available but there is also a request from a thoracic surgeon for an ICU bed for a patient currently in the observation room, and there is a request from a nearby hospital to transfer one of their patients to Dr. B’s ICU.

Dr. C, a pediatrician, has been asked to chair her hospital drug formulary committee to examine new drugs and determine which ones should be provided from the hospital budget. She is aware that these decisions are complex and often controversial and is unsure how to proceed.

What is priority setting?

Priority setting involves deciding which resources to allocate to competing needs. It is a key component of every health system because, whether wealthy or poor, no system can afford to provide every service that it may wish to provide. Both publicly and privately funded systems have the challenge of delivering quality care within the limits of government budgets or enrollee and employer contributions.

Within health systems, priority setting occurs at each decision level: micro (at the bedside or in clinical programs), meso (in hospitals or regional institutions), and macro (at the system-wide level). Clinicians are directly involved in priority setting at the micro level and often involved at other levels; however, decisions at each of these levels are inter-

related. In the context of clinical programs, such as in the first case opening this chapter, the ICU director must decide which patient gets an ICU bed. This decision itself is related to decisions in the critical care program about how many beds to keep open and how many nurses to maintain on staff, and these are related to the hospital level decision about the importance of critical care in that institutions and how much of the hospital’s budget flows there, and these are related to both funding for that hospital and system-wide funding for critical care.

Why is priority setting important?

Health system sustainability is related to the effectiveness of the priority setting decision making within the system. The costs of health-related services are constantly increasing, with drug costs leading the rise. Demands for health services are increasing as a result of new technologies; increased public awareness fueled by the Internet; aging populations in Western democracies; pandemics such as HIV/AIDS, malaria and tuberculosis; and an alarming increased prevalence of non-communicable diseases, such as cancer and cardiac disease, in the developing world. The current growth in healthcare expenditures is unsustainable and is limiting the ability of governments to fund education, infrastructure, and other priorities. Therefore, setting priorities regarding what we will and will not provide is vital to the sustainability of any and all health systems.

252D. K. Martin, J. L. Gibson, and P. A. Singer

Ethics

Justice requires that like cases should be treated alike and that the benefits and burdens of health services be allocated equitably across patients. Knowing what decisions to make would be quite simple if we could agree on the criteria to guide equitable allocation of resources. However, at the crux, priority setting decisions involve choosing among a complex cluster of criteria (e.g., clinical factors, patient values, system goals) that may be morally relevant to any one specific decision. Moreover, reasonable people may disagree about how these criteria should be applied and which values should be emphasized, particularly in the context of clinical uncertainty; competing patient, program, or system goals; and multiple stakeholder interests. For example, when deciding which patient gets the bed in the intensive care unit (ICU), should the ICU director emphasize benefit, and give the bed to the patient with the longest most productive life ahead, or emphasize need, and give the bed to the patient who is the most vulnerable? The conflict widens when the choice involves cost differences. For example, should patients be given a very costly drug that may keep them out of the ICU? Or, in the context of drug-funding decisions, such as in the second case opening this chapter, should we prefer a very costly drug that would provide a large benefit to a few patients or a less costly drug that will provide a lesser benefit to many patients?

No consensus exists about an overarching moral theory to help to resolve differences between conflicting values. Therefore, the goal must be to make these decisions in an environment where the conflicting values can be explicitly identified and deliberated upon in a morally acceptable manner. In other words, the goal is fairness.

One of the most helpful advances in priority setting has been the development of ‘‘accountability for reasonableness,’’ an explicitly ethical framework that provides guidance for decision makers who want to implement fair priority setting (Daniels and Sabin, 1997; Daniels, 2000; Daniels and Sabin, 2002). It is theoretically grounded in justice theories

emphasizing democratic deliberation (Rawls, 1993; Cohen, 1994). ‘‘Accountability for reasonableness’’ specifies conditions that operationalize the ethical concept of fairness. A fair priority setting process meets four conditions: relevance, publicity, revisions/appeals, and enforcement (Table 33.1). Recently, we proposed a fifth condition – empowerment – arguing that power differences between individuals within healthcare institutions, which prevent some from fully participating in decision making, may negatively influence the fairness of priority setting and so must be attenuated by leaders within the institution (Gibson et al., 2005).

Other approaches, such as economic evaluations, may be helpful: for example, cost-effectiveness analysis when setting priorities among new technologies or drugs, or program budgeting and marginal analysis when deciding among programs. However, these approaches emphasize a narrow range of values (e.g., efficiency), and not the full range of relevant values. Therefore, economic evaluations, like any other technical approach, must be considered within the context of a fair priority setting process (as described above). For example, recent work in Canada and the UK has shown how program budgeting and marginal analysis may be used in conjunction with ‘‘accountability for reasonableness’’ framework (Gibson et al., 2006; Peacock et al., 2006).

Law

Legal frameworks are not clinically precise and are more often helpful in identifying what decision makers may not do, rather than what they should do. In general, the law focuses on the reasonableness of allocation decisions in light of existing legal standards and the salient facts. Legally, physicians have a fiduciary relationship with their patients and are expected to meet a reasonable standard of care. Similarly, as fiduciaries of the hospital corporation, hospital board directors have a duty to act honestly and in the best interests of the corporation and its members as a whole, to exercise due diligence in making decisions on the basis of

information reasonably available, and to meet an expected standard of care in discharging these duties. Therefore, in some jurisdictions, the courts have been reluctant to become involved in judicial review of how physicians or hospitals use their resources (e.g., R. v. Cambridge Health Authority, 1995.) To use Canada as an example, the Canada Health Act mandates reasonable access to medically necessary services but does not specify what those services should be, nor does it specify a mechanism for making these difficult and contentious decisions. The Canadian Charter of Rights and Freedoms and provincial human rights codes prohibit discrimination on grounds of race, ethnicity, religion, age, sex, sexual orientation, and physical or mental disability. In case law, a British Columbia judge noted that physicians’ primary duty is to their patients, and that financial considerations cannot play a decisive role in clinical decisions (Law Estate v. Simice, 1994).

Empirical studies

At the micro level, healthcare professionals decide which individuals are cared for first, which patients receive which diagnostic tests and which drugs, which patients are admitted to a hospital bed, and which patients are taken to the operating theater. Micro-level priority setting (also known as bedside rationing) is inevitable because of the increasing gap between the possibilities of effective medical interventions and the available resources (Pearson,

2000). Klein et al. (1998) described six forms of bedside rationing: denial, deflection, deterrence, delay, dilution, and termination. They stated that denial and termination were the most severe forms of bedside rationing and they rarely occurred in industrialized countries with publicly financed healthcare systems.

However, broad characterizations often cover con- text-specific practices, which often vary. In emergencies, triage conventions require that life-threatening situations be addressed first. But in non-emergency clinical programs, such as critical care, neurosurgery, cardiac surgery, and general medicine, the allocation conventions are unclear and variable and should be examined in context. A number of professional associations have also developed detailed allocation policies for non-emergency clinical programs such as critical care (e.g., Council on Ethical and Judicial Affairs of the American Medical Association, 1995; Carlet et al., 2004). However, the allocation conventions are often variable across policies and it is not always clear how they should be applied in context.

Critical care studies by Mielke et al. (2003), Martin et al. (2003a), and Cooper et al. (2005) determined that ICU admission decisions varied from clinician to clinician. Some prioritized great need, others the potential for benefit. Some prioritized the young, others the elderly; often, referring physicians who pushed the hardest and loudest ‘‘found’’ a bed for their patient. Even in contexts where admission policies exist, the policies only distinguished between broad categories