Hospital Management in the Ever Changing World of Health Care

By Terry Hill, Senior Advisor for Rural Health Leadership and Policy

We all know that change is the new constant in healthcare. Many rural hospitals are considering options for aligning with other hospitals and/or health systems. Rural hospitals also face periodic changes in leadership and are challenged to find the right CEO. A good first step might be to identify a selection process or a model that has proven to be a best practice for others.

Recently, I interviewed Lynne Cunningham from Studer Group, who has just completed a successful assignment for a public hospital board in rural Alabama, which resulted in the successful identification of a new management partner for the hospital. The following are highlights from this conversation.

Q:  Today's healthcare leaders need an advanced level of skill to meet the continuous changes now so common in the industry. The future of organizations in healthcare relies heavily on making the right leadership choices to manage this environment. What steps should a board/executive team ponder when they realize they need a new approach to management? Would you consider your recent work a best practice?

A:  Good question. Yes, I would consider it a best practice. I think it’s important to “begin with the end in mind” as Stephen Covey would say. The board and executive team need to have serious conversations about the range of options they are willing to consider and the values which are important to them regardless of the choices they will entertain. I think there are four questions for the selection committee to consider:

1. What results are you looking for?
2. What type of individual are you looking for in a new executive?
3. What culture do you want to promote?
4. What values must an organization have if they are looking for a new management company?

Q:  How do you thoughtfully make the decision?

A:  There are some logical steps to take in making a thoughtful decision.

• Organizational Assessment

This first step diagnoses your organization’s strengths, opportunities, vision and environment. During the assessment, your consultant will want to talk to executives, board members, community leaders, providers, hospital leaders, and employees. The deliverable from the organization assessment should be a research report with specific recommendations. These recommendations will make it easy to move to a job description for a new CEO or to a request for proposal (RFP) for a management company.

• Prioritize Your Candidates

Review a side-by-side comparison of the proposals you receive. The proposals you’ll get (or the resumes for CEO candidates) will be long. It’s best to use a board created decision-making matrix, which prioritizes the key attributes for success that your organization is looking for, and compare candidates/proposers across these variables to prioritize those that meet your requirements.

• Use Behavioral-Based Interviewing

Conduct telephone interviews with all viable candidates using behavioral-based questions that help you see how your candidate or proposing organizations have responded to a particular situation in the past. The best indicator of future performance is past performance! Send the interviewees additional questions in advance that need to be answered in these telephone conversations.

• Update Your Side-by-Side Comparison

Continue to update the side-by-side comparison and then conduct in-person interviews with final candidates. Ask the candidates/proposers to focus their in-person presentations on critical factors that will be used to make the final decision.

• Use the Decision-Making Matrix

The decision-making matrix will help you quantify your reaction to candidates or various management companies. As the final interviews are conducted, have each member of the selection team use the decision-making matrix as their guide for evaluation.

• Select the Best Candidate/Company

By using the decision-making matrix, it typically will be clear which candidate/proposer is the best fit.

• Gain Board Concurrence

Once the selection committee has agreed on their recommendation, gain board concurrence on this recommendation.

Q:  Okay, so the process to select a successful candidate/proposer has been completed. Isn’t that when the hard work really begins? How do you negotiate for success?

A:  You’re right, now we get the lawyers involved as you either:

• Enter contract negotiations to finalize an employment contract for approval by the board, or
• Enter contract negotiations and due diligence to finalize a management contract

If everyone has been engaged throughout the process, these negotiations are apt to proceed smoothly. Due diligence with a new management company may take 90 days or more, but contract negotiations and some transitions can occur simultaneously.

Q:  Is there anything else you’d consider a critical success factor?

A:  Yes, I think a well thought-out strategic communications plan is essential. It’s likely that a lot of internal and community stakeholders are aware that you are about to make a decision. Once the choice has been validated by the board, implement a comprehensive strategic communications plan to internal and external audiences. Control the message to the greatest extent possible. I’d suggest the plan include:

• E-mail blast to employees and providers

Cascade the same message to all employees and providers to reduce variance in what your target audience is exposed to.

• News release to the public

Transparently share information with the community and proactively position the “why” behind your action as a mission-driven decision.

• Town hall meetings with employees and providers

The consistency of the message is maintained when employees and providers are hearing from the same executives in multiple meetings. In today’s electronic environment, one of the sessions can be videotaped and posted on the organization’s intranet. Unlike the e-mail blast, these town hall meetings provide an opportunity for employees and providers to ask questions and hear directly from those in leadership about how the change may impact work at the facility.

• Community meeting open to the public

As a critical community resource, your community members will want to know about changes at their hospital or with their providers. Give them an opportunity to hear from executives and the board and to ask clarifying questions.

Yes, this is a lot of work, but I really think the planning and organization will pay off in support for your decision.

The Medicare Rural Hospital Flexibility Program Reaches Sweet 16

By Sally Buck, CEO

It is an exciting time for the Medicare Rural Hospital Flexibility (Flex) Program state grantees and partners as we recognize the program has reached its sweet 16, which is to say 16 years in existence. The Flex program was born as part of the Balanced Budget Act of 1997 to provide funding to states for the designation of critical access hospitals (CAHs) in rural communities and allows hospitals to be reimbursed on a reasonable cost basis for inpatient and outpatient services provided to Medicare patients. There are now 1,326 CAHs in the Flex program that play an essential role in sustaining rural health care.

The National Rural Health Resource Center (The Center) has the pride of a parent seeing their "child" reach this milestone of 16 years. Terry Hill, former Executive Director of The Center, was involved in the initial development of the Flex Program with the Federal Office of Rural Health Policy (FORHP) to support small rural hospitals in the conversions, development of networks, quality improvement and financial stabilization. Through a contract, The Center established an innovative technical assistance model: Technical Assistance and Services Center (TASC) in 1998 to provide information and education about Flex to the state grantees and their partners. 

In the infancy, TASC supported the states with development of rural health plans and creating "any necessary provider" rules, financial feasibility tools for assessing conversions. Through the toddler years, TASC provided state Flex grantees with education on cost reports, establishing networks for care transitions and quality improvement. It’s hard to imagine, but when we started, we didn’t have webinar technology, and the webpages were often static pages without search functions.

By the 10 year mark, the Flex program had moved into CAHs with swing beds to accommodate post acute care services. The "any necessary provider" rules reached their sunset, and conversions to CAH status dramatically declined. Flex programs and TASC mobilized to support CAHs to trauma designations through emergency medical services (EMS) and CAH training and regional planning. With a decade of experience, TASC, the Flex Monitoring Team (FMT) and state Flex programs worked together to provide CAHs with more data about the financial, quality and community engagement status within their state and nationally. Hospital Compare was launched by the Centers for Medicare & Medicaid Services (CMS), and although CAHs weren't required to report quality, hundreds of performance indicators became more important for all hospitals.

As the Flex program reached the awkward stage of the teenage years, the grantees adapted to new reporting requirements, and outcome-focused work plans. CAHs were watching the transformation of health care payment models evolve without a small volume option. A new initiative, the Medicare Beneficiary Quality Improvement Program (MBQIP) was introduced by FORHP in 2010 to increase quality reporting by CAHs with rural relevant measures and data to spur quality improvement efforts. This was a critical activity as CAHs were experiencing some bullying about their performance. With MBQIP, the Flex program has dramatically increased quality reporting by CAHs and states have implemented  a number of initiatives to improve patient safety, satisfaction and patient outcomes.

Now at 16 years of age, Flex is developing a vision of what it will become in the future as a mature program and what impact Flex, with over 1,300 CAHs, will have on rural health care in the U.S. and the thousands of communities served. With the changes in health care delivery and payment, the Flex Program needs to continue to share best practices, learn from peers and experts to ensure small rural hospitals can continue to improve care and the health of rural communities and reduce costs. Happy Sweet 16 to the Flex Program, and best wishes for many more successful years to come!

                                                                                                                          

Walk a Mile in your Funder's Shoes

By Margo Kulseth, Information Specialist

“Walk a mile in my shoes.” This familiar idiom was the advice given to an audience of rural health grantees, grantors and stakeholders in Kansas City, Missouri on September 30, 2014 at the Federal Grant Writing Workshop during the keynote session by Kim Moore, President of the United Methodist Health Ministry Fund. “In order to write a good grant application, we must think like the grant funder,” said Moore. What does the funder want to accomplish in awarding this money? What will motivate the funder to choose my application?

Kim Moore

Moore shared the following tips for grant seekers:

1. Consider the “lens” of the funder and write the application in those terms

• What aspect of health care is the funder’s focus? Disparities? Social determinants? Social justice? Cultural competency?

2. Understand the rules and limitations of the grant

• They can be complex and the same language may mean different things to different people

3. Do not fight the rules and limitations of the grant

• Some of the limitations may seem unfair, but you are very unlikely to persuade the funder to change the grant

4. Do not assume your project is not what the funder is looking for

• It may not be obvious at first glance, so dig deeper
• Go to Grant Makers in Health at www.gih.org to find funders interested in health in your state or region

5. Respect the process laid out by the funder as you would like to be respected as the applicant or grantee

• Do not go over someone’s head in an attempt to get funding

6. Give the information on a level your funder understands and needs

• Do not be too brief so as to leave questions and doubts in the mind of the funder, but don't be facetious either

7. Show how you will leverage limited funds to create significant impact

• The biggest challenge of philanthropy is creating positive change with limited resources
• How will not completing your project be more costly in the long run?

8. Show how your project is likely to be sustainable beyond the term of the grant

• Funders want to provide short term money that will have a long term impact (NOT vice versa)
• Include a plan for how your project will continue once the money runs out (Hint: Do NOT say it will only continue by seeking other grant sources unless you have very likely ones in mind)
• The purchase of equipment or training people how to do something new are good examples of sustainable use of grant funds

9. Show the funder the risk of investing in your project is likely to pay off with lessons learned that can be shared and used by others

10. Create a strong evaluation plan

• How will you know your project is successful?

11. Create measurable outcomes

• Do not over- or under-promise
• Measurement should be commensurate with project scale
• What is your cost per unit of service?
• What is the quality of work?
• Will people be healthier or happier because of your project?
• The data should grow out of the work and inform the grantee of whether the project has been successful
• Outcomes should be logical, appropriate and likely to occur
• If XYZ happens, we will be happy about it and celebrate it

12. Have a dissemination plan for the project results

• Are you going to write a report? Hold a webinar? Put the results on a website? Convene a conference or workshop?
• Collaboration and sharing of lessons learned is one of the best ways to use grant funds wisely
• Most problems cannot be solved in siloes
• Bring all the stakeholders and their resources together for sharing

13. Point out the secondary benefits of the project

• Will the project establish new working relationships? Develop a new and improved culture? Cross boundaries of traditional roles?

14. Include support letters from involved entities expressing their endorsement of your project if possible

• Do not create such a negative picture of the need that you lose the opportunity
• Balance the need description with the assets realistically available in the community

15. Discuss in advance how the grant award will be announced

• Be careful to handle the process legally and within the guidelines of the funder

16. Become known by your funder beyond the written application

• Get to know your funder personally if you can
• Learn about each other

Mr. Moore told the audience, “Your work is more than a job. It’s a personal passion to advance the rural health system.” It is the same with funders. Most want to do more than give away money. They develop learning communities for grantees, hold webinars, conferences, workshops, provide technical assistance and generally want to see their grantees succeed and create positive change that can serve as examples for others to follow. Funders want partnership with and among their grantees.

The benefits of collaboration cannot be overstated. Grantees in the rural health arena or any other must align with and build on each other’s work. It is not just about getting and giving money. Success will come from aggregating resources, sharing, learning and disseminating together. Perhaps if we attempt to walk a mile in each other’s shoes, it will help us to appreciate and capitalize on our common goals for the greater good of improved rural health care.

Kim Moore presenting at the Federal Grant Writing Workshop in Kansas City, Missouri on September 30, 2014