☰ Menu

CHC in the Spotlight

HELP WHERE HOSPITALS NEED IT ®

HELP WHERE HOSPITALS NEED IT ®

Community Hospital Blog

Hospital Performance Improvement
Board Communication, Teamwork, Spell Success at Yoakum Community Hospital

by Karen Barber, CEO, Yoakum Community Hospital

 

Leveraging Resources for Change

 

When I joined the Yoakum Community Hospital team in 2006, one of the biggest hurdles I faced was improving board-management relationships. I realized that addressing this challenge would be essential to paving the way for a better, more secure financial and operational future for the hospital and community. Elorine Sitka, Yoakum Board Trustee and Chair, shared this vision, and together, we turned ideas into reality.

As a 25-bed critical access hospital in rural Yoakum, Texas, it became apparent that trustees had not been receiving all the information they needed — in a timely way — to make well-informed decisions. We realized that trustees were challenged in performing their basic fiduciary and financial duties, and change was necessary to inspire and create a high-performing board dedicated to the hospital’s success.

 

As partners, our goal was to improve the hospital for the good of the community. We developed recommendations on ways to improve board relations and engagement – laying a solid benchmark for success for many rural hospitals.

 

Five Steps to Success

 

Certain basics are “must-haves” for continuous improvement in board-management relationships, including:

 

1. Clarify expectations regarding roles and responsibilities

Governance and management are distinct functions. At Yoakum today, board members view their role as strategists and overseers. They leave management and operations to hospital leaders and managers, although that wasn’t the case previously. Board members provide direction. Managers create and implement tactics to support board strategies. One significant consideration is to provide board members with updates to keep them in the loop.

 

Identifying specific responsibilities in written form can also help prevent confusion related to roles. Discussions about mutual expectations are important, too. What do trustees expect of the CEO? What types of things can a CEO do without prior board approval?

 

2. Foster open, consistent communications

Regular, informal phone calls and a weekly newsletter are great tools to keep board members informed. An online portal provides members with meeting materials to review at least a week in advance. Trustees are encouraged to reach out to leaders if they have a question or concern, as well as participate in meeting discussions and respectful debates.

 

3. Make meetings purposeful

Make board meetings organized and action-oriented. Take informational items off the agenda for trustees to read on their own. Focus face-to-face time on several major issues that require voting at board meeting time.

 

I strongly suggest that everyone “stick to the agenda.” The entire team is busy, so keep meetings short and on point. And set aside time to socialize. Sharing a meal together before getting down to business inspires fellowship and teamwork.

 

4. Create resourceful onboarding and continuing education

New trustee orientation is vital and should include meetings with key stakeholders, including the CEO and CFO, as well as important partner organizations. A tour of the hospital and distribution of educational materials including an organizational chart and a glossary of healthcare industry terms and acronyms are part of the process.

 

5. Identify potential trustees

A specific recruitment process for new trustees is key. At Yoakum, we maintain a running list of potential board members, keeping in mind leaders and colleagues with diverse backgrounds. Another consideration is to identify potential board members without any sort of personal agenda. The focus should be on improving the hospital for community health.

 

We also encourage board members to listen to presentations offered by hospital staff, and take advantage of state and other sponsored trustee education programs. At Yoakum, we also invest in an annual board retreat and involve trustees in monthly birthday celebrations and other hospital events.

 

Building on Success

 

Looking back, the difference at our board meetings today is obvious. Today we have a strong board and dependable, trustworthy leadership committed to a common purpose.

 

To learn how Yoakum Community Hospital developed a high-performing board, read this CHC case study.

Tags: Hospital Board Advisory, Hospital Performance Improvement, Operational Improvement, Strategic Direction
Staffing and Productivity: Tips for Success

By Jill Bayless, CHC SVP Clinical Services

 

Improving a hospital’s financial performance seems relatively simple – it’s driven by decreasing costs and increasing revenue. In reality it’s quite complicated to optimize these factors while keeping quality care top of mind. One of the biggest challenges for hospitals is managing staff productivity, which means maintaining the right number and mix of clinical staff based on patient diagnoses and volume. Optimizing productivity is critically important because the cost of labor is the greatest expense for a hospital.

In our experience, almost every hospital has some room to improve staffing productivity. Here are some top-line recommendations to help a hospital department run more like a successful business.

  1. First of all, take a look at the numbers. Compare staffing levels to patient census information for the hospital as a whole and for each specific department. Reviewing staffing data over time will help identify trends and opportunities for improvement.
  2. Next, investigate the reasons for any discrepancies. Bring key players to the table – department managers, administrators and others - to discuss possible alternatives. Would shifting and flexing based on time of year or physician activity be advisable? Invite questions from everyone engaged in the process.
  3. Set an acceptable productivity target standard. Use the data review, input from personnel and national benchmarks to establish a standard staffing ratio for the hospital overall and for each department.
  4. Establish ongoing tracking system. A plan to maintain this productivity standard is critical for success. Successful hospitals make department managers responsible for meeting staffing benchmarks and for implementing flexible staffing based on patient census figures.
  5. Review the standard. On an ongoing basis, set up a regular time for managers and leaders to review departmental staffing guidelines and make necessary changes.

Some additional tips on staffing and productivity:

  1. Look at total hours paid vs. hours worked, which excludes PTO and holiday time. Hours worked is the best benchmark to use for the purpose of improving staff productivity. Each department will have a unique work standard; for example, the number of procedures in the OR, or patient census on an inpatient unit.
  2. Consider work process redesign. The best department managers and CNOs manage staffing levels from shift to shift and cross-train personnel across departments, especially in smaller facilities.
  3. Rethink span of control. It may be possible for one director to manage several departments.
  4. Analyze compensation practices across the organization for standardization and consistency.
  5. Always monitor quality of care – HCAHPS, patient perception, and employee and physician satisfaction. Examine readmissions and other quality of care metrics regularly to ensure quality of care.
  6. From an operational perspective, consider the potential impact of external factors. For example, if one surgeon is leaving the hospital staff, how might that affect OR staffing requirements until a new surgeon comes on board?
  7. Help to educate hospital board members on the potential impact that managing productivity will have on the hospital’s financial performance. In many cases, where there is marginal financial performance, a focus on productivity will allow the facility to maintain viability.

CHC offers a comprehensive assessment to help clients take an in-depth look at productivity and staffing concerns. Learn more about CHC Operational Assessment Services.

Tags: Hospital Performance Improvement, Hospital Staffing, Operational Assessment , Operational Improvement, Productivity Assessment
Building Successful Hospital-Board Relationships

by Craig Sims, SVP, Southwest Hospital Operations, CHC

 

Community-based hospitals put the “care” in healthcare, and

meaningful hospital-Board partnerships based on trust and mutual goals drive this mission. Board members make important decisions to serve the community , and help develop strategies to ensure the hospital’s long-term sustainability.

 

Here are some best practice tips for positive, productive Board-CEO relationships.

  1. Develop a Trustee recruitment and retention process. Recruiting and retaining Trustees is too important to be left up to chance. In fact, “retention” begins in the recruitment phase and never ends. Initial orientation for new Board members should include one-on-one time with the hospital CEO and CFO, as well as the Board Chair and Finance Committee Chair. After six months, ask Trustees about their orientation and education experience. Seek ways to improve.
  2. Foster open communication. Communicate with candor. Facilitate two-way dialogue and encourage open communication. Create an environment of trust to help everyone tackle tough decisions. Even if there are dissenting opinions, a collegial atmosphere allows Board members to say to one another, “I value your input — tell me more.”
  3. Communicate frequently with Board members. Share timely information on hospital and community events, along with local, regional and state issues impacting health care. Provide educational articles and links, send out Board packets in a timely fashion prior to Board meetings, and utilize current technology to facilitate communication (electronic Board packets and Board portals, for example).
  4. Make meetings meaningful. Start with the “why” instead of the “what.” Begin Board meetings by reading the mission, vision and values of the organization instead of jumping into reports. Productive meetings require engagement; move informational items off the agenda for Trustees to read on their own. Focus on three to five issues that require voting. In closing the meeting, the Board chair should ask the group:

    -     Did we focus on the right issues?

    -     Did we participate in an active way? 

  5. Understand the difference between governance and management. The role of the Board is governance. The Board governs and sets policy; hospital administration manages and implements policy. Hospital Boards should focus on strategy, not operations.
  6. Facilitate continuous learning. Effective boards are well-educated. Budget for Board education, including learning opportunities such as:
    -     Comprehensive Board orientation
    -     Annual Board self-assessment
    -     Planned continuing education
    -     Board retreats

 CHC offers a variety of advisory services depending on client needs — including board education — to help enhance hospital CEO-board relationships. Learn more about CHC Hospital Board Advisory Services

Tags: Hospital Board Advisory, Hospital Performance Improvement, Strategic Direction
Three Steps to Help Rural Hospitals Overcome Financial Distress

by Michael Morgan, Director of Due Diligence and Strategic Analysis, CHC

 

An array of issues – from increasing charity care, bad debt and declining reimbursement rates to negative profit margins – create financial distress for rural hospitals. Despite today’s challenging operating environment, many rural hospitals across the country are using a practical approach to grow revenues and control costs.

 

Step 1: AWARENESS

Know the signs and symptoms of declining financial health

 

How does a hospital reach the point of “no return” where closure becomes inevitable? Were there warning signs along the way? Were they missed? Would the outcome have been different if danger signals had been noted and addressed?

 

Discussions around performance, growth and capital stewardship are at the heart of strategic planning for most health care organizations, and even though financial indicators are a harbinger of financial health, “finance” is often considered the responsibility of the chief financial officer or other “financial” folks. Budgeting is usually department-specific.

 

Like car dashboard warning lights, financial warning signs mean it’s time to sit up and take notice. A regular review of the most important indicators related to an organization’s financial health should be a shared responsibility for the entire health care team. Data points to focus in on include:

  • Look at aggregate volume and provider utilization trends. This data can offer a big-picture perspective to leaders and managers across departments.
  • Share operating ratios, including expenses as a percent of net operating revenue focusing on labor, supplies, and purchased services.
  • Examine labor costs relative to volumes. Is the hospital meeting productivity goals? Look at FTE staffing per adjusted occupied bed targets.
  • Review patient revenue indicators including bad debt percentage and net to gross percentage by payor class. Are there shifts in payor mix that need to be addressed?
  • Study liquidity ratios, such as net days in patient accounts receivable and cash collections as a percentage of net revenue minus bad debts. What steps can be taken to improve cash flow?

Step 2: INFORMATION GATHERING

Identify and assess significant financial indicators

 

Operational best practices include a monthly review by hospital leadership of key measures, many of which are listed above. Procedures should be put in place by the hospital’s finance department, with input from department managers, to produce accurate monthly stats and financial performance metrics to facilitate these periodic reviews. A closer look at financial indicators also should be part of the annual review and planning process. A key to financial improvement for hospitals is clear communication of expectations and goals across the leadership spectrum in order to accomplish desired changes.  

 

Step 3: ANALYSIS & ACTION

Connect the dots for sustainability

 

Once data is available to everyone, the next step is to analyze the root cause. For instance, if inpatient admission volumes are down significantly in a current month compared to the same month in the previous year, the conclusion might be, “We think it went down because there were fewer flu cases this year compared to last year.” That may be true, but speculation can be risky. Do a deep data dive and take the guesswork out of the equation. What were the primary diagnoses of the admitted patients for each time period? Were there any abnormal physician trends? How do observation days this month compare? Understanding the trends and their causes is the key to creating actionable solutions.

 

Regular reviews of key financial indicators can identify operational best practices, support strategic planning efforts, enhance understanding and create accountability. These reviews can confirm or redirect efforts aimed at sustainability. The most critical element of the entire process is answering “why.” Only then can the team develop solutions to improve operating margins and avoid financial distress.

 

Learn more about CHC's Financial Improvement services.

Tags: Affordable Care Act, Healthcare Reform , Hospital Management, Hospital Performance Improvement, Operational Improvement, Strategic Direction
Strategy and Vision Planning for Results

By Cindy Matthews, Executive VP, CHC.

 

Strategic planning. It’s listed at the top of meeting agendas, discussedin hallways, and generally viewed as a blueprint for organizational growth and success. It’s how businesses (should) plan for the future, after all. Although the purpose of strategic planning is to enhance an organization’s performance, growth and revenue — classic business objectives with obvious benefits – many participants say “it takes too much time,” or “it’s disconnected from the way we actually operate.” How can this be?

 

“Strategic planning” usually isn’t the issue. According to the Harvard Business Review, it’s how the process is developed and managed to support ongoing decision making. Here are some guidelines to restructure and facilitate the strategic planning process to make it more effective and relevant to your hospital’s daily operations.

 

(1) Assemble key stakeholders to create a clear vision for the future. The first step is to bring everyone to the table to discuss how the hospital can move forward effectively —board members, medical staff and hospital leadership. Explore your desired future state, asking questions such as “Where do we want to be, what’s helping or hindering us from moving forward, and how can we get there?” Talk about the hospital’s strengths and weaknesses too, internal and external. And don’t forget education as a component of the conversation. Share information on the hospital’s service area and patient demographics, market share, the Affordable Care Act and how it may be impacting patient volumes, and more. This visioning process is integral to effective planning.

 

(2) Identify strategies to support attainment of the vision. How will you achieve your desired outcome? Outline key operational, physician, employee, financial, technological and growth strategies for the next three years to help turn vision into reality.

 

(3) Develop action plans for implementation. Now that strategies are defined, the next step is to identify key tactics and measurements for each initiative. Be sure to document plans with timelines and accountability. Engage departments and staff in the strategy execution process. A disciplined approach helps everyone be accountable. A related note: make strategy development continuous, spreading strategy reviews throughout the year to focus on a single issue at a time. Don’t limit reviews to a two- or three-month time period.

 

(4) Align business planning with strategic planning processes. Business-unit focused plans related to service line growth, physician alignment, operational efficiency, clinical quality and patient engagement/satisfaction must be consistent with the organization’s strategic objectives. Leaders should work closely with hospital managers to ensure department and service line business plans and budgets align with hospital strategic planning efforts.

 

When we’re caught up in day-to-day operations, planning can become an afterthought or an exercise in futility. Reconfigure the process to clarify a shared vision, advance stakeholder collaboration, define responsibility and improve decision making.

 

Learn more about CHC Strategy and Vision Planning services.

Tags: Affordable Care Act, Hospital Performance Improvement, Operational Improvement, Strategic Direction

CHC in the Spotlight