Strategic management of health care organizations plays an important role in their further development and guarantee of achieving excellence in services provided. This paper analyses the pillars of excellence demonstrated by Schneck Medical Center and describes implementation of the HSA principles and practices by this medical center. Emphasis is also put on the necessity and benefits of wise financial planning within the healthcare field and importance of a clear communication and compliance with ethical norms and obligations of the medical entities.
Description of the Company, its Mission, and Values
Schneck Medical Center was founded in 1991. It is a nonprofit hospital operating in the Jackson County, Ind. It provides specialized and primary care services possessing 93 licensed beds. Treatment of diseases related to such areas as noninvasive cardiac care, women’s health, cancer care, bariatric surgery, and joint replacement is its core specialization today.
It is needed to point out that Schneck Medical Center employs more than 800 employees, cooperates with 150 affiliated physicians, and gives the opportunity to 300 volunteers and 200 students to receive valuable experience providing high quality help to medical center’s patients and their families. It should be stated that Schneck Medical Center demonstrates the high level of performance in the healthcare field and was the winner of Malcolm Baldrige National Quality Award in 2011. This medical center is “a fully integrated system that delivers a continuum of patient-focused care”. It demonstrates the highest ratings in performance measures relating to focusing on the delivery of the most patient-oriented services, achieving and keeping financial ratios at a high level, empowering and educating its medical staff, and being the conscious member of the community.
Schneck Medical Center’s mission is “to provide quality healthcare to all we serve”. The vision of the company that points the direction for all employees sounds as “To Be a Healthcare Organization of Excellence… Every Person, Every Time”.
Aiming at achieving excellence in each part of its operations, Schneck Medical Center spreads it core values – integrity, compassion, accountability, and vision. Schneck leadership system is based on four pillars of excellence. They are the quality of care, customer service, human resources, and fiscal operations.
It is noteworthy that Schneck Medical Center implements such a corporate culture where employees are the highest value for the company, where the patients are treated with dignity and respect, and community is perceived as an important member of Medical Center’s operations. Schneck Medical Center “has a strong commitment to its employees, volunteers, and physicians, as seen by the establishment, operation, and continuous improvement of multiple workforce-focused programs, projects, and policies based on survey feedback from each group”.
The Implementation of the HSA Principles and Practices by Schneck Medical Center
By winning the Baldrige reward, Schneck Medical Center confirms the effectiveness of the implementation of the HSA principles and practices into its daily operations. It is necessary to underline that Schneck Medical Center outperformed its competitors due to “Patient First culture, strong financial foundation, technology integration, quality and stability of the workforce, and focus on excellence”.
Patient First culture is the “visiting card” of this nonprofit organization. Such a culture is created by empowered employees that are not only talented professionals, but also individuals who strive to help other people and fulfill this task in the most efficient and qualitative way. Schneck Medical Center demonstrates such a level of patient satisfaction ratios that is placed in the first quarter of all medical centers operational results. Areas where Schneck Medical Center is a leader are inpatient quality of care, inpatient customer service, inpatient coordination of care, timeliness, ambulatory education, and inpatient family support.
It is necessary to point that Schneck Medical Center has a strong financial foundation. This aspect allows the medical center to “deliver excellent patient care as evidenced by outstanding healthcare outcomes”.
Schneck Medical Center’s advantage in the strategic management realm is the implementation of the value-based purchasing strategy. This strategy implies that medical center, in particular its physicians, nurses, and other employees are more accountable for the quality and cost of the serviced they provide. The key to this shift is not based on the system of punishment, but is formed by the motivating system of incentives, the so-called system of awards and consequences. Medical staff is more committed to provide high quality service to all patients and to create such a medical center that is a leader in all performance measures relating to the level of service quality, patient satisfaction, and employer-employee relationships. Moreover, Schneck Medical Center positions itself as the caring neighbor and takes part in different initiatives, which is unique for the local community it serves.
The Skills Needed to Administer Financial Planning and Measure Financial Performance within a Health Service Organization
It should be stated that financial planning implies defining the organization’s objectives by creating and monitoring the implementation of plans of incomes and expenses, which are based on existing financial resources and take into account the external environment of the organization. It is noteworthy that financial planning specifies scheduled forecasts, specific way of their implementation, the indicators related to the established tasks, the consequences of their implementation as well as methods for achieving the selected purposes.
With the aim to reflect on the depth and completeness of the financial analysis, it is necessary to demonstrate accuracy and comparability of indicators. Justification of financial performance, planned financial transactions, and effectiveness of business decisions requires strong analytical skills. The top management of the medical entity must clearly understand company’s need in the financial, labor, and intellectual resources, the sources of their inflow, and to be able to calculate the efficiency of use of available resources accurately.
The Benefits of the Financial Planning Skills Paired against what the Company Realized
It is important to note that the benefits of financial planning are the ability of the medical entity to establish measurable financial goals, understand how each financial decision affects the company’s performance, and re-evaluate existing company’s financial position to find out whether the company follows the established direction. Moreover, financial planning process allows the company adjusting its expectation for the performed investments due to the use of different ratios that indicate future gains and possible risks for such a decision.
The importance of financial planning implies the possibility to identify strategic objectives of the medical entity in the form of bends financial and economic indicators: costs, profits, investment, and cash flow. It sets standards for the flow of financial information in the form of financial plans and performance reports and determines the acceptable limits of financial resources needed to implement immediate and long-term plans of the enterprise. Operational financial plans provide useful information for the development and adjustment of a wide financial strategy. Long-term financial plans provide the financial resources needed to finance real investment projects to ensure the future development of the company.
Executives of the medical entities face the necessity of making the right, but tough decision regarding the possibility of huge capital investments, maintenance, and renovation. It is crucial to integrate strategic management of the healthcare entity and financial planning with the aim to build accurate budgets and implement them into practice. Financial planning assists the executives of the medical entity in measuring the current company’s performance, creating financial projection, outlining financial requirements, and integrating financial process with the direction that was established in the strategic management field.
It is needed to emphasize that Schneck Medical Center demonstrates strong positions in such measures as operating margin, cash position, and cash flow. Relating to the Standard & Poor’s (S) ratings, it is necessary to point that Schneck Medical Center demonstrates excellent and stable results balancing between “A-” and “AA” ratings. It is also worth noting that “from 2008 to 2010, SMC’s gross revenue results showed growth in the organization’s strategic focus areas – women’s health, joint replacement, noninvasive cardiac care, cancer care, and bariatric surgery”.
Efficiency in the financial planning and control allows Schneck Medical Center spreading its financial, human, and other resources efficiently and increasing its market share gradually. As for the main market, Jackson County, Schneck Medical Center market share varies between 60 – 80 percent in the inpatient care, outpatient care, and ambulatory care realms.
It is essential to point out that Schneck Medical Center has implemented the system of daily and monthly control over the effectiveness of its performance, in particular monitoring the costs. Annual audit of the performance results is also obligatory whereas it is the part of the “Run the Business” approach. Improved operating margin as well as bond rating is the core evidence of the efficiency of the existing financial management of the medical center.
The Ethical Considerations that are Relevant to Health Care Service Establishments
Medical ethical principles aim at protecting the rights and interests of the patient and they apparently have to be completely human. However, in real life things are not so simple. Physicians are often put in a situation when they have to make decisions contrary to the rules of medical ethics. In this case, the healthcare professional is trying to make a decision that would cause less harm. The moral responsibility of health professionals includes keeping all the principles of medical ethics. Incorrect diagnosis, treatment, physician behavior of the middle and junior medical staff can lead to physical and moral suffering. Such actions of the health professional as disclosure of medical secrecy, denial of medical care, and violation of privacy are unacceptable.
It is important to recognize that at Schneck Medical Center “senior leaders, also known as the Administrative Executive Council (AEC), guide the organization, support effective self-governance, review performance, and establish and maintain strong organizational culture”. Schneck Leadership System is an integrated system that improves the cooperation of all structural components of the medical entity. Administrative Executive Council promotes ethical behavior within its medical entity by constant education of its employees of the established ethical principles and conducts annual refresher training. Moreover, ethical behavior is demonstrated by the members of the Administrative Executive Council on their own examples while making daily decisions.
Corporate Compliance Program is implemented. There is “zero-tolerance” to the conflict of interest issues. In the Schneck Medical Center, “Just Culture focuses on prevention through the identification of potential process issues and corrective action, rather than placing blame for errors”. Legal and ethical behavior is also promoted by the implemented Standards of Behavior. These standards are applied to each level of employees hiring and working process either it is an interview, new employee orientation, or existing employee job evaluation. Feedback is provided on the constant basis and employees’ errors are perceived as a possibility to grow and improve professionally.
Schneck Medical Center conducts Environmental Scan – a procedure that reveals potential concerns and threats relating to the legal and ethical issues. Multiple feedback mechanisms are implemented with the aim of obtaining full data regarding the current state of performance level within the medical entity. Different surveys and focus groups are involved in gathering an in-depth information.
The Challenges Presented in Health Care Organizations Today in Regard to Collecting, Sharing, and Protecting Patient Information
Keeping strict confidentiality is one of the most essential ethical issues in the healthcare field. It concerns the issues of collecting, sharing, and protecting patient information. Any information about the patient that the healthcare professional receives from the patient as a result of examination cannot be transferred to third parties without the consent of the patient. The subject of confidentiality includes the data about the health of the patient, the diagnosis of disease, the prognosis of the disease, and all the information that has become available to the physician as a result of examination or according to patient’s words. Privacy in the relationship between a professional and a client (physician and patient) is necessary because it is a confirmation of such fundamental value as privacy.
The rule of confidentiality is a condition of protecting the social status of the patient. Medical confidentiality protects the economic interests of patients. Information about human diseases can dramatically limit his/her economic, social, and political opportunities and affect his/her business and promotion. Confidentiality is necessary to ensure openness in communication between a doctor and a patient. Confidence of patients in a strict confidentiality is a key to their openness as a condition for normal professional activity providing.
Richards, Prybutok, and Ryan (2012) argued that the “use of individual healthcare information gathered, stored and shared via an Electronic Medical Record for analyzing and designing procedures and solution also leads to enhanced care for the patients”.
Schneck Medical Center is the bright example of the medical entity that places the safety and comfort of the patients above all. It has made “large investments in IT infrastructure to ensure that databases are secure and user friendly, and can be accessed throughout the continuum of patient care”. Electronic medical record system was implemented at the Medical Center in 1999. It guarantees full confidentiality for the patients and enhances the overall productivity within the healthcare entity.
Effective Communication that Can Be Used to Improve Ability to Persuade, Manage Conflict, and Share Information
It is worth noting that ineffective communication has caused a significant increase in the number of occurring medical errors. Poor communication between the top management of the medical entity and employees, between healthcare professionals, medical staff, and the patients cause reputational problems for the medical entity relating to the emotional and physical harm to patients; such a misunderstanding costs the medical entity a lot.
Nowadays, healthcare environment has become more diverse and complex. Gaps in the communication at all levels of the healthcare organization mean obvious weaknesses in guaranteeing the safety of the patients and the highest level of services provided. Inability to predict a conflict and ignorance of basic methods of conflict resolution are particularly damaging under the medical conditions when the patient is irritated and his/her psychological state is worsened. Modern health care professionals should be able to possess strong communication skills to inform the patient and to provide leadership in coping with the disease basing on the knowledge of his/her personality, in particular developing a “person-centered” approach to the patient and understanding psychological aspects of clinical practice affecting the patient.
During treatment, conflict situations are unavoidable. Competent and ethical behavior that fully coincides with ethical principles and values established at the healthcare entity will be the best guide to solve such situations. Healthcare professionals need to be able to identify psychological components of the disease and its effects, to recognize desires and expectations of the patient while taking into account his/her values, goals, and challenges. Any physician, clinical psychologist, and any other medical professional is required to have communication skills with patients, to be able to competently communicate information about the patient’s problems and aspects of his/her treatment to him/her and to his/her family, and to communicate effectively with patients.
It is important to understand that not all patients have developed communication skills, and the state of the sick person provokes communication problems. Healthcare professionals must be able to inform the patient and his/her family properly about their role in the therapeutic process, therapeutic options, and recommendations, to explain and comment on the appropriate treatment to achieve the consent of the review both from the patient and his/her relatives.
Schneck Medical Center pays much attention to the communication patterns while performing its daily operations. Senior management creates a transparent culture inside its medical entity. Such a culture facilitates open two-way communication that improves the productivity of the operational process. “The Administrative Executive Committee (AEC) recognizes that communication is more effective, messages more accurate, and staff more appreciative when the AEC are visible and communicating directly”.
It is necessary to point that Administrative Executive Committee conducts rounding on a monthly basis where they emphasize the most crucial events and plans that the medical center has. Moreover, various professional insider newspapers such as HR Pulse Newsletter, In Touch with Gary Newsletter, and The Anchor Newsletter are distributed. Employees’ suggestions, complaints, and proposals are listened to during the medical staff meetings of committee forces.
An Alternative HSA Policy and Practice that Aligns with the Business Strategies of Schneck Medical Center
The core framework of the Baldrige business system, which was taken as the facilitator of improving the initial performance management at Schneck Medical Center, includes such pillars as leadership, strategic planning, workforce focus, customer focus, and operational focus. Results obtained upon the thorough analysis of current weaknesses and advantages of the medical center should be the driver for the further improvement of the excellence of the service provided.
It is important to recognize that Schneck Medical Center has made a huge step towards the implementation of the Baldrige criteria to its performance. It is obvious especially in the way Schneck Medical Center deals with patients, educates and supports its employees, and satisfies the interests of its other stakeholders. However, there is no limit to perfection. With the aim of being the best medical entity regarding the high service quality provided, Schneck Medical Center has to pay more attention to avoiding unnecessary or costly care. This applies above all to the speed of response to the acute cases in the cardiology. Schneck Medical Center has made substantial efforts towards resolving this complex task by even cooperating with its main competitor, and it all has been done for the benefit of patients. However, increasing operational productivity in this field will result in improving the level of services and will be another step towards the achievement of the status of excellence in everything the medical center performs.