Posts Tagged ‘Hospital Administration’

It’s Been (Quite) a Year…

December 19th, 2009

Last year at this time, as word of the global economic meltdown was beginning to take hold, we saw the beginning of a decline in all aspects of purchasing, including the  optional surgeries and tests in our hospitals.  At the same time, as a member of several volunteer boards, we began to see declines in ticket sales that went as high as 20%.  Later, we met with restaurateurs who indicated that their business was down between 10 and 20%, an amount that proved to be terminal for numerous marginal companies.

obama_health_costs

As the year proceeded, we saw  hospitals make extensive cutbacks in employee  education, travel, and marketing.  This trend became the norm in the industry.  The healthcare-related industries that seemed to hurt the most were those involved in construction and new equipment acquisition.  One type of firm that did well was financial consulting groups, like SunStone Consulting, LLC , organizations that specialized in finding money that hospitals had already earned, but had either not been staffed deeply enough to pursue or that did not know the processes necessary to generate these funds.

For those of us in administrative consulting, the year has been interesting.  Decision makers stepped back a little and waited to see where Obamacare was heading, to collect more cash in a society where “cash was definitely king,” and to cut back on new initiatives until things had settled down economically.  These leaders watched the markets, looked at investment activities, counted revenue versus expense results, and generally became more conservative in their leadership approaches.

What’s on the horizon:  There is an old saying that “He who looks into a crystal ball to predict the future will get crystal in his eye,” that is not far from truth.  Are we completely out of the woods?  Not by a long shot.  Will there be additional taxes, additional expenditures that are not budgeted nationally?  Yes, most assuredly, there will be, but are we certainly seeing more positive signs in virtually every economic indicator that would predict at least a somewhat more optimistic overall outlook.

Wall Street Journal: Pointing to renewed signs that the global slump is bottoming out, the International Monetary Fund on Wednesday upgraded its outlook for 2010 while slightly trimming this year’s forecast.

The overleveraged global financial system continues to cast a shadow over the economic outlook, however, and the fund urged policymakers not to become complacent about recent market improvements.

“Financial conditions have improved, as unprecedented policy intervention has reduced the risk of systemic collapse and expectations of economic recovery have risen,” the IMF said in its updating its outlook for the world economy and financial system. “Nonetheless, vulnerabilities remain and complacency…

100_on-iceSo, if we embrace those little rays of hope as a means of restarting the economic engines, if we visualize a better future for all of us, if we focus on the positive, at the very least we most likely will find a better parking space at the Mall!

Happy Holidays and here’s knowing that 2010 will be a better year for everyone.  (It wouldn’t take much!)

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The Marketing Enigma

February 15th, 2009

As the economy continues to present its myriad of challenges nationwide, hospital executives are embracing a variety of cost-cutting measures at a very high rate of implementation. Delays or discontinuation of capital projects, employee layoffs, and a variety of other broad-based measures are currently dominating the healthcare environment.

Departments without direct patient contact are usually perceived to be the easier layers to peel in these expense reduction activities. Areas such as marketing, community, and public relations often become prime targets as they are significantly scaled back or even disbanded.

Historically, hospitals have implemented fluctuating sequences from one extreme to another as they have decreased and increased marketing department sizes and budgets through the various economic cycles. Unmistakably, in challenging economic times, marketing is nearly always more important than ever. Without knowledge concerning the various services available, the patients will not be aware of the nuances of each and how they could impact their health and wellness.

Having said this, however, many hospital executives are not experts in this area, and consequently, they simply move in lockstep with those individuals who see these programs as non-patient expense centers that merely drain the organization of its valuable resources even further.

BusinessDictionary.com aptly describes marketing as the management process through which goods and services move from concept to customer. As a philosophy, it is based on thinking about the business in terms of the customer, or in healthcare, patient needs and their satisfaction. As a practice, it consists of the coordination of four elements:

  • identification, selection, and development of a product
  • determination of its cost
  • selection of a distribution channel to reach the patient, and…
  • development and implementation of a promotional strategy designed to reach these goals

In order to avoid erroneous decisions that could lead to disastrous business consequences for the organization, marketing evaluations might be performed by professional marketing assessment companies specializing in this arena. Some of these firms can provide this service in economically viable risk-reward agreements that do not further complicate the financial challenges being addressed. They specialize in the evaluation of services that detail which marketing functions need to be continued and which functions should be restructured, and/or outsourced. The goal of these marketing evaluation firms is to:

  • help preserve the existing positive effects created by marketing
  • build better marketing practices, and…
  • cut the unnecessary associated costs

In two decades of observing the yo-yo phenomena described above, we have worked with numerous individuals and firms along the way, but none have been more valuable than the firms that specialize specifically in this area of marketing department analysis.

Firms that provide this specific service can be found through the American Association of Healthcare Consultants, The American Marketing Association, and the Society for Professional Marketing Services.

In our work, however, we have found at least one company that has continuously provided the necessary analytic and evaluation components required to complete this sensitive task. Corathers Health Consulting is a unique organization because it utilizes luminaries and unique specialty consultants through a team approach for most of their highly customized projects. What we observed when we worked with Corathers was that their distinguished consultation supplied an unparalleled differentiating factor over the other consulting companies with whom we had previously worked, but they are one of many such firms.

Regardless of the organization chosen, the concept is the key, and that is that you owe it to yourself and to your organization to understand exactly what can or should be eliminated or outsourced before the cuts are irreversibly implemented. The future of your organization may lie directly under that hatchet, and once the decision has been made, reverse is a costly gear to find on a very bumpy road of lost business, missing publicity, and absent advertising. The answer lies in cutting wisely and appropriately as you attempt to keep patients informed and to grow your business.

Linking a patient-Centered Approach to Quality Improvement & HCAPS

Nick Jacobs, FACHE addresses the 2008 Healthcare CEO Summit, co-sponsored by the Picker Institute and Planetree. Chicago, IL USA – Fall, 2008

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