Editor's Note: The following is the second of a two-part series on the "Five Cornerstones for Exceptional Healthcare."
Stellar employees are Cornerstone #3 of the best community hospitals. Employees can make a great hospital or break a marginal one. Employees are the principal contact with inpatients, emergency patients, outpatients, and family members. Those who have an ingrained sense of quality and customer service do their best for patients, whether it means making meals, cleaning floors, or counseling how to understand complicated hospital bills.
Contrary to naysayers, there are hospitals serving small rural communities that do a superb job. They may not have the fanciest buildings, but they have something even more powerful: employees with a calling to do their jobs well and provide the best service to patients and families alike, and that can make all the difference in their hospital’s survival.
On the other hand, I have observed “rich” suburban hospitals, on the brink of bankruptcy, whose principal problem was an overload of indigent patients but incompetent management and surly employees, often accompanied by dysfunctional boards. Absence of leadership in the boardroom and CEO’s office will almost never lead to great employees. There are rare exceptions; I have observed a few community hospitals with superb employees who held the hospital together in spite of poor boards and revolving door CEOs, but this is not the rule.
In my experience, four things distinguish a great community hospital employee culture. First, employees work hard; no one stands around or wastes time. They spend every working minute trying to do the best possible job. Second, they are nice to everyone - patients, family members, and fellow employees – and treat everyone like they want to be treated. Third, they stand up for quality and safety. If they see an unsafe situation, they report it and see that it is fixed. And fourth, they accommodate, not hiding behind outdated policies, but doing their best to say “yes” to patient and family requests.
Volunteers are the unsung heroes of excellent hospitals. Every great one has a dedicated cadre of volunteers who selflessly give their time, providing much-needed services to patients and families. Volunteers allow hospitals to invest precious staff dollars where they are most needed. Show me a hospital with a passionate group of volunteers, and I’ll show you a well-supported and successful community asset. Show me a hospital with few or no organized volunteers, and I’ll show you a hospital destined to fail.
Great employees and volunteers are an essential part of the future for successful hospitals. Great leadership from the board and CEO is essential for creating a superb work force. Great leaders attract and retain great employees and volunteers. Dysfunctional boards and poor CEOs attract everyone else.
I was once in a board meeting of a community hospital clearly in trouble; three CEOs and two management companies had come and gone during the previous five years. Finances were badly in the red, and physicians and employees were quitting in droves. I was asked to consider managing the hospital, just before it was likely to file for bankruptcy if unable to dramatically improve.
At this meeting board members pointed many fingers. “It’s the CEO’s fault;” “We take care of too many poor people;” “That rotten management company took all our money” - these were just a few of the comments. Every board member had a favorite villain.
When they tired of the blame game, I asked board members one simple question: “Who gets their personal healthcare in this hospital?” Two out of 10 board members raised their hands. I then said, “You don’t have a CEO problem, or a money problem, or a physician problem. You have a board problem.” If the board does not support their local hospital, how can they expect the community to support it?
Strong community support, Cornerstone #4 for successful hospitals, begins in the boardroom. A number of community hospitals thrive in poor rural areas and profoundly poor inner city neighborhoods. One recurring theme for these successes is that board members set the example by getting their healthcare close to home, in their own hospital, while encouraging everyone they know to do likewise. In successful hospitals, locals support and use their hospital, and this goes double for one-hospital communities. When most locals get their healthcare out of town, it is an obvious sign the hospital is in grave trouble.
Community support does not end with the board, it starts there. The CEO, management and medical staff, and employees and volunteers all need to show support by being leaders in churches, community groups, and local agencies. By contributing time, they enhance the quality of life in their community, which reflects positively on their hospital. Hospitals have a huge reserve of talented people. Putting that talent to work for the community is characteristic of a great performing hospital.
Successful hospitals also have a fundraising foundation. Even some of the smallest hospitals in the poorest communities actively solicit community donations. They may never get million-dollar donations, but every time a resident contributes $10, he or she can take pride in being a small but important “owner” of their hospital.
Excellent boards set the tone, ensuring community support is both given and received, and they attract excellent CEOs, physicians, staff, and volunteers, all of whom help achieve strong community support. Without good leadership, hospitals inevitably fail. With good leadership they find a way to thrive.
Responsible finances is Cornerstone #5 for exceptional hospitals. After many years advising and running troubled hospitals, I can say with certainty that finances are never the critical cause for hospitals getting into distress and eventually failing. Surprisingly, even “rich” hospitals can and do fail. If finances are not the principal cause for hospital distress, what is? Poor leadership is the answer.
Hospitals with dysfunctional boards, revolving door CEOs, lackluster employees, and no community support are destined to fail, no matter how much they have in the bank or how rich their patients. Yet, even hospitals in rural and poor areas can survive if they have a foundation of a good governing board, CEO leadership and responsible finances.
Responsible finances means a balanced budget comes first. A common denominator for failing hospitals is they operate in the red for years. They spend more than they take in, and don’t take ownership of the problems that cause them to operate in the red. Instead, they are adept at blaming reimbursement, government, non-paying patients, greedy management companies, etc.
Excellent hospitals manage revenue and expenses so they at least break-even or, better yet, make a small surplus which can be reinvested to make the hospital better. They manage staffing levels, supply expenses, and capital investments responsibly, to ensure break-even or modestly profitable operations. They also raise money in the community to help pay for building improvements and up-to-date technology.
Excellent hospitals manage debt responsibly, understanding new technology and buildings add to their debt load. They carefully evaluate the impact that accrues with new debt. One common cause of financial distress is building a new facility, only to find out there isn’t enough new business to cover the additional debt. Subsequently, many overextended hospitals close or are acquired by for-profit companies. This is not to say hospitals should never upgrade or replace aging facilities. But experience shows many dysfunctional boards and poor CEOs have caused the downfall of their hospitals by not planning for paying off debt for new facilities they hoped would solve their problems.
Responsible finances is management with common sense, by not spending more than what is taken in. It is not adding new debt unless it can be paid back. Excellent hospitals have responsible finances down pat.
Addressing leadership problems with the governing board and CEO is hard. Some hospitals don’t have the courage to look in the mirror and begin meaningful change for the better in the boardroom, and they ultimately fail. Hospitals that improve governance and CEO performance have a fighting chance to succeed. Let’s hope our community is one of the fortunate ones that begin the journey to long-term success by putting the highest priority on improving leadership.
Michael Rindler is a resident of Apalachicola.