Term Paper on "Hospital the Facts: The Community"

Term Paper 8 pages (3048 words) Sources: 1+

[EXCERPT] . . . .

Hospital

The Facts:

The Community Hospital in the present case study saw its beginnings during the mid-1800s and has come a long way since then serving a population of nearly 13,000 inhabitants. Its location from the nearest large city is 15 miles which itself has four major hospitals and 40 miles from the state capital with more medical conveniences. Apart from that, the Hospital also caters to the medical needs of five very small and nearby rural towns with a net total population which is estimated to be 35,000 inhabitants. It continues to be a general hospital since inception because of the presence of many large hospitals in its vicinity. Although the hospital has good doctors in attendance, majority of them have grown old in their profession and as such the Hospital will be facing a severe shortage of doctors 10-15 years down the line. The Hospital is facing a crunch on the financial front as the minimum occupancy rates have fallen well below the break-even point needed for the Hospital to stay afloat.

With continued below the mark occupancy rates, its operating cash will be wiped out within 4 to 5 years. To make matters worse, both government bodies as well as insurance providers are putting pressure for fee cut while maintaining the same levels of facilities. The Hospital Administrator has almost served his lifetime and due for retirement within 1- 3 years however his activity has been dormant for the last several years. Even though the hospital is running well with an enhanced level of professionalism, it is starting to appear that it has lost its focus and going nowhere. The various Departments have started to show lack of cohesiveness among th

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emselves and trying to corner their share of limited financial resources and to safeguard their own interests. Besides employee turnover, is also turning to be an issue to be dealt with. (Analysis of Case Study)

The Pointers:- i) in terms of numbers of years put in business, the community Hospital has a distinct edge, but it could not utilize its long experience to its advantage. Running a hospital business for such a long period gives certain edge over its competitors who are new to the business due to lower operating costs, economies of scale, enough scope for modernization and offering several other value-added services. (ii) Its target consumers consist of people from the community of 13,000 people and also from the small and rural nearby towns whose total population is estimated to be 35,000. Due to its distance both from the nearby large city as well as the capital city, it cannot compete with the city hospitals as regards reach and availability of superior medical facilities. Besides, being a general hospital and not a multi-specialty one, its growth prospects have also suffered. In the present healthcare scenario, every hospital earns its popularity due to its excellence in a particular sphere of remedial care like cardiac or orthopedic or surgery etc. apart from providing a broad range of normal care services. Being a general hospital since long, it is losing its patients even from its community who might be visiting the city hospitals for specialized care.

A iii) One of the major problem of the Hospital has been ageing doctors who will be retiring within the next 10-15 years and unless replaced will face a critical shortage. This problem has to be addressed seriously as doctors are the backbone of the Hospital system. Young doctors are not forthcoming to initiate their practice in the region. (iv) Low occupancy rates below the breakeven point is another area of concern as continued subdued performance would render staying in business unprofitable in the long run. In that situation the Hospital would be unable to meet its fixed costs which will force itself to close down. (v) a revamping exercise is necessary as the Hospital has lost its sense of direction and just existing which it cannot for long. (Analysis of the Case Study)

Getting the Hospital on Track:

Mission and Vision:-

Midvale will be a regionally recognized health centre of choice for the nearby community. The Hospital will be a compassionate provider of patient-centric health services with importance on tertiary-level and specialty care, mainly for the nearby inhabitants. It has been envisioned that Midvale will be developing, sharing and applying new knowledge and technology in the delivery of patient care. Midvale Hospital will be playing a crucial role in promotion and improvement of health within the community. Midvale will be forging partnership to tackle the needs of the community and to build a robust, integrated system for regional health care delivery. (Vision, Mission, Key Success factors, Core Values)

Short-term goals:-

The short-term goals of Midvale will be to change its nomenclature and convert it into a Critical Access Hospital or CAH. By such conversion, it will have access to support by permitting cost-based reimbursement for care provided to Medicare beneficiaries which are given to small rural hospitals like Midvale. Midvale can fulfill the condition for becoming a CAH by earmarking 25 acute care beds and assign it as critical for the care of the community due to its distance from other hospitals and bringing in a certification from the state as a 'necessary provider'. (Freeman; Walsh; Rudolf; Slifkin, 2005) Among the benefits of converting into a CAH comprise (i) Privilege of cost-based reimbursement from Medicare that has the capability to augment revenues. Since the cut-off date 1st Jan, 2004, CAHs qualify for cost plus 1% reimbursement. (ii) Attention to the needs of the community. (iii) Joining the CAH network with a critical care hospital for support and expansion of services. (iv) Provision of flexible workforce and services, to the limit that state licensure regulations allow (v) Capital improvement costs clubbed in allowable costs for determining Medicare reimbursement. (vi) Access to Flex Program grants money. (CAH Frequently Asked Questions)

Two primary ways are available that staffing needs are more flexible for CAHs under the Medicare Conditions of Participation or CoP. (i) Medical Staff: It is mandatory that CAH should be having one doctor at the minimum however the doctor is not needed to be at the location always. Midlevel practitioners can be active, independent constituent of the CAH medical staff and extend direct service to the patient. As Midvale is experiencing problems in recruiting new doctors, this will be favorable for the hospital. (ii) Nursing staff: - it is necessary for General acute care hospitals to have a Resident Nurse or RN at the site on a round the clock basis. CAHs possess increased flexibility as regards staffing levels in case of nurses. The federal needs permit the hospital to close in case the utility is empty. The needs of the state differ. There are some states who offer flexibility by permitting an LPN to cover a shift in lieu of an RN in case no serious patients are available. (CAH Frequently Asked Questions)

Long-term goals:-

In order to be successful in the present intricate and often unfavorable business setting, Midvale's strategic direction must be evaluated, focused, and financially sustainable. Strategic business planning is an essential instrument to assist organization focus strategic preferences within the financial veracity of their setting. An efficient strategic business planning cycle comprises of performing an assessment, locating business objectives, developing strategy, conducting an impact analysis, and building an implementation plan. Strategic business planning brings into line strategic priorities with the financial realities. This translates into lesser priorities, implementation time frame which will be shorter and higher threshold for returns, or residual benefit in favor of the organization. The important steps in integrated strategic planning comprises of conducting an evaluation, locating business objectives, developing strategy, performing an impact analysis, and building an implementation plan. (Bachrodt; Smyth, 2002) i) Conducting a Market and Competitive Assessment: The sole firmness in the present era's healthcare scenario is a constantly changing set of assumptions regarding the future. The assessment stage sets the basis for planning. The intensity of analysis at the evaluation stage might change. Nevertheless, at least, three important areas of analysis are required which is defining future market scenarios, finding out a financial outlook, and identification of strategic advantages and weaknesses. Answering a few fundamental queries can develop future market scenarios. (a) How the demographic profile of the market of Midvale appear in the forthcoming five to ten years. (b) Will changes in the demographic pattern need our service area to be streamlined identically or differently in the coming years? - Are there going to be changes in the utilization rates for specific services go up, come down or remain unchanged. (d) Will advent of new technology create or alter the demand for specific services. (e) Will the present or anticipated market forces alter the delivery point for particular types of care? Replies to these types of queries can be modeled to set up a baseline and future market scenarios as a basis for planning. (Bachrodt; Smyth, 2002)

The outcomes must show both the market sizes for specific services and… READ MORE

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Quoted Instructions for "Hospital the Facts: The Community" Assignment:

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Utilize the Case Study Method as a general guideline for developing a strategic plan as a resolution to “The Hospital” case study by incorporating the most viable alternative(s) into the strategic plan which will include (1) a vision or mission, (2) short-term goals – 1-3 years, (3) long-term goals – beyond 3 years, and (4) a detailed implementation strategy.

“Hospital” Case Study

Midvale Memorial Hospital is a small community hospital that was established in the mid-1800s. It is governed by a 7-person Board of Directors and managed by a Hospital Administrator, who basically carries out the directives of the Board.

The community maintains a fairly stable population of approximately 13,000 people. It is situated about 15 miles from a large city that has four major hospitals. And it is about 40 miles from the state capital with even greater medical facilities and resources.

In addition to serving the immediate town, it also serves the needs of five very small and rural adjacent towns for a total, combined population estimated to be 35,000 people.

The hospital has had a long tradition of providing a full menu of medical services ranging from clinics to birthing to emergency room, intensive care and minor, to moderate surgery. Because of its proximity to several larger hospitals, it has not developed any particular medical expertise or specialization.

There are also several large employers in the vicinity that include manufacturing, distribution, and a moderate number of retail stores with a total, combined workforce of about 20,000 people.

And the hospital also serves the general needs of the local school system as well as two nearby regional school systems, all with active sports programs.

The hospital has enjoyed a very stable population of affiliated doctors. However, their average age is 52 years and there is a growing difficulty in recruiting new doctors to establish their practice in the community. It is anticipated that unless something is done, there will be a critical shortage of doctors within the next 10-15 years.

Fortunately, the staffing of nurses has been adequate and, thus far, there has been no major problem with recruiting or retention. There has been some limited success in encouraging some of the nurses to continue their education and become nurse practitioners.

Financially, the hospital has not been doing very well. At present budget levels, it has been required to keep 50 of its 80 beds filled in order to “break-even.” However, it has only been able to keep between 40-45 filled on a regular basis. At this rate, its limited endowments will be depleted within the next 4-5 years. Making the problem even worse is the extreme pressure being exerted by insurance providers and government programs to reduce fees while maintaining benefit levels.

The current Hospital Administrator has been employed in this capacity for nearly 30 years and has recently announced a desire to retire within the next 1-3 years, depending on when a successor can be found and hired by the Board. The Board is actually pleased with this decision as it has been felt that the Administrator has gone into “semi-retirement mode” for the last several years.

Although the hospital continues to function well and at a high level of professionalism and efficiency, it is beginning to seem like it has lost its focus or sense of direction. There have been minor but increasing signs that friction is developing between departments as they try to jockey for their share of the dwindling financial resources to protect their own interests. Also, employee turnover has never been a problem until recently and this is becoming a concern as well.

Based on a suggestion from the hospital’s Human Resources Manager, the Board has agreed to initiate a 3-day strategic planning retreat to try to sort through all of the issues and try to develop a strategic action plan to “get the hospital back on track” – and to determine what that track should be.

In preparation for this retreat, each member of the Board has been asked to develop what he or she thinks an action plan or long-term strategic plan should be for the hospital and to be prepared to present and discuss it at the retreat. This action plan should consist of

(1) a vision or mission, (2) short-term goals – 1-3 years, (3) long-term goals – beyond 3 years, and (4) a detailed implementation strategy.

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