Middleton Hospital Scenario as Middlefield Hospital Approaches

Middleton Hospital Scenario As Middlefield Hospital approaches the beginning of another year serving the health needs of our community, the strides we have made in replenishing the workforce with qualified staff should be applauded, but there remains work to be done. After meeting with the Chief Financial Officer (CFO) and listening to a detailed analysis of the hospital's financial performance during the last six months, it has become apparent that Middlefield must consider fundamental adjustments if our strict budgetary limitations are to be met.

Having convened a meeting of Middlefield Hospitals' team of executives and managers, a total of six critical obstacles to future profitability have been brought to my attention, including the arrival of a competing medical facility in the region which is attracting patients and internal issues in terms of billing and insurance.

In order to maintain a policy of proactive preventative measures designed to assure the financial viability of Middlefield Hospital, while also honoring our commitment to key stakeholders including physicians, nurses, patients, and the community at large, I have devised a four-pronged approach to resolve the most pressing issues threatening the hospital's fiscal solvency. Below you will find my advisory guidelines, based on extensive research in applicable fields, to be used for the formulation of a more effective and efficient hospital policy.

The payer mix of Middlefield Hospital is comprised of more and more Medicare, Medicaid, and uninsured patients, and fewer patients have commercial insurance. This is reducing overall reimbursement and net income for the hospital. In order to overcome Middlefield's disadvantages when it comes to payer mix, I am convinced that adapting the strategic structures used by the nation's most overachieving hospitals to our particular circumstances can produce increases in overall reimbursement and net income.

After reviewing the data assembled by a California Healthcare Foundation study of hospitals which thrive despite poorly rated payer mixes, I recommend a reemphasis on "the importance of [our] reputation for delivering high-quality care in negotiating payment rates with commercial payers" (Rundall et al., 2010). By pushing our commercial payers to offer rates commensurate with the excellent care Middlefield Hospital has always provided, we can effectively balance the reduction in patients who carry commercial insurance.

Predictive analysis of similar hospital's experiences after renegotiating rates with commercial payers indicates that Middlefield can realistically expect increases in revenue across the board which will exceed the losses currently being incurred by the reduction in commercially insured patient intake. The nearby hospital that competes with Middlefield has opened a wellness center that offers a comprehensive array of preventative and wellness services to the community. This facility is attracting young families to seek services at this location.

While the arrival of a direct source of competition for patients is undoubtedly regrettable, Middlefield Hospital currently lacks the financial wherewithal to directly counter many of our rival's strategies. If current policy shifts produce the expected return to profitability, it would then be advisable to institute a steering committee charged with drafting plans for Middlefield's own wellness center.

During the interim, I recommend that our nursing staff begin actively encouraging preventative wellness treatments to young families who are current patients, with the hope that they develop an association between Middlefield and wellness. The Joint Commission survey is scheduled for next year, and there are significant problems with the hospital's quality improvement program.

I am extremely concerned with the state of our quality improvement program, especially considering the recent comments made by Director of Quality Improvement Barbara Seville, who confessed that "Middlefield's quality improvement activities are not effective anymore." It is unacceptable to continue a policy in which there is "lots of data collection and reporting, but there is little improvement in the quality of care." Due to the apparent failure by management to fully emphasize the importance of improving the quality of patient care, I have made the difficult decision to terminate Ms.

Seville's employment with Middlefield Hospital effective immediately. Rather than "relying too much on our past reputation," I recommend beginning an expedient search for qualified, experienced candidates for the open position of Quality Improvement Director. By replacing Ms. Seville with somebody who is prepared to act decisively on their observations, and providing them with at least nine months preceding the Joint Commission survey, Middlefield Hospital can assure that our quality improvement program is achieving its objectives according to local, state, and federal guidelines.

The health plan offered to employees is getting more expensive each year. In fact, the costs are increasing at a rate of 20% each year. This is adding.