In our work over the years advising health systems on M&A, we’ve been struck by how often “social issues” cause deals that are otherwise strategically sound to go off the rails.
Of course, it’s an old chestnut that “culture eats strategy for breakfast”, but what’s been notable, especially recently, is how early in the process hot-button governance and leadership issues enter the discussions.
Where is the headquarters going to be? Who’s going to be the CEO of the combined entity? And most vexingly, how many board seats is each organization going to get? That last issue is particularly troublesome, as it’s often where negotiations get bogged down. But as one health system board member recently pointed out to us, getting hung up on whether board seats are split 7-6 or 8-5 is just silly—in her words, “If you’re in a position where board decisions turn on that close of a margin, you’ve got much bigger strategic problems.”
It’s an excellent point. While boards shouldn’t just rubber stamp decisions made by management, it’s incumbent on the CEO and senior leaders to enfranchise and collaborate with the board in setting strategy, and critical decisions should rarely, if ever, come down to razor-thin vote tallies.
If a merger makes sense on its merits, and the strategic vision for the combined organization is clear, quibbling over how many seats each legacy system “gets” seems foolish. No board should go into a merger anticipating a future in which small majorities determine the outcome of big decisions.
After filing a lawsuit in May to end its affiliation with Renton, Wash.-based Providence, Hoag Memorial Hospital in Newport Beach, Calif., is alleging it is now the target of retaliation, according to the Los Angeles Times.
Hoag Memorial said that Providence removed Hoag Memorial’s three facilities from its website of Southern California locations and terminated Hoag Memorial’s specialists from St. Joseph Heritage Healthcare, a network of medical providers for managed care plans in Southern California. Additionally, Hoag Memorial said that Providence informed Heritage members they would lose access to Hoag’s 13 urgent care centers by Dec. 31.
According to the report, Providence’s notice to patients that Hoag facilities and physicians would be dropped from its network all came in the fall of 2020, amid the COVID-19 pandemic.
“It was the most inappropriate, inexplicable and harsh thing to do to a lot of patients,” Hoag President and CEO Robert Braithwaite told the Los Angeles Times. “Finding a new physician or new specialist is particularly hard on seniors and any patient who has a chronic condition and has established a long-term relationship with an endocrinologist or rheumatologist or cancer doctor.”
Providence told the Los Angeles Times it disagrees that patients have been disadvantaged.
“We are committed to the well-being of our communities and to serving patients with high quality and compassionate care,” a Providence spokesperson told the Los Angeles Times.
Hoag Memorial has been affiliated with Providence, a Catholic health system, since 2016.
Hoag Memorial said the changes all came after the hospital sought to end its affiliation with Providence by filing a lawsuit. Hoag Memorial said in its lawsuit it is seeking to end the affiliation because Providence is undermining local decision-making and Catholic Church restrictions are expanding.
Providence has fought Hoag’s lawsuit to end the affiliation. The health system claims Hoag doesn’t have the right to unilaterally dissolve the affiliation, and its board members don’t have the authority to file the lawsuit. An Orange County Superior Court judge rejected Providence’s argument Feb. 1 and scheduled another court hearing for March.
Hardly one month into 2021, the pressing priorities facing healthcare leaders are abundantly clear.
First, we will be living in a world preoccupied by COVID-19 and vaccination for many months to come. Remember: this is a marathon, not a sprint. And the stark reality is that the vaccination rollout will continue well into the summer, if not longer, while at the same time we continue to care for hundreds of thousands of Americans sickened by the virus. Despite the challenges we face now and in the coming months in treating the disease and vaccinating a U.S. population of 330 million, none of us should doubt that we will prevail. Despite the federal government’s missteps over the past year in managing and responding to this unprecedented public health crisis, historians will recognize the critical role of the nation’s healthcare community in enabling us to conquer this once-in-a-generation pandemic.
While there has been an overwhelming public demand for the vaccine during the past couple of weeks, there remains some skepticism within the communities we serve, including some of the most-vulnerable populations, so healthcare leaders will find themselves spending time and energy communicating the safety and efficacy of vaccines to those who may be hesitant. This is a good thing. It is our responsibility to share facts, further public education and influence public policy. COVID-19 has enhanced public trust in healthcare professionals, and we can maintain that trust if we keep our focus on the right things — namely, how we improve the health of our communities.
And as healthcare leaders diligently balance this work, we also have a great opportunity to reimagine what our hospitals and health systems can be as we emerge from the most trying year of our professional lifetimes. How do you want your hospital or system organized? What kind of structural changes are needed to achieve the desired results? What do you really want to focus on? Amid the pressing priorities and urgent decision-making needed to survive, it is easy to overlook the great reimagination period in front of us. The key is to forget what we were like before COVID-19 and reflect upon what we want to be after.
These changes won’t occur overnight. We’ll need patience, but here are my thoughts on five key questions we need to answer to get the right results.
1. How do you enhance productivity and become more efficient? Throughout 2021, most systems will be in recovery mode from COVID’s financial bruises. Hospitals saw double-digit declines in inpatient and outpatient volumes in 2020, and total losses for hospitals and health systems nationwide were estimated to total at least $323 billion. While federal relief offset some of our losses, most of us still took a major financial hit. As we move forward, we must reorganize to operate as efficiently as possible. Does reorganization sound daunting? If so, remember the amount of reorganization we mustered to work effectively in the early days of the pandemic. When faced with no alternative, healthcare moved heaven and earth to fulfill its mission. Crises bring with them great clarity. It’s up to leaders to keep that clarity as this tragic, exhausting and frustrating crisis gradually fades.
2. How do you accelerate digital care? COVID-19 changed our relationship with technology, personally and professionally. Look at what we accomplished and how connected we remain. We were reminded of how high-quality healthcare can go unhindered by distance, commutes and travel constraints with the right technology and telehealth programs in place. Health system leaders must decide how much of their business can be accommodated through virtual care so their organizations can best offer convenience while increasing access. Oftentimes, these conversations don’t get far before confronting doubts about reimbursement. Remember, policy change must happen before reimbursement catches up. If you wait for reimbursement before implementing progressive telehealth initiatives, you’ll fall behind.
3. How will your organization confront healthcare inequities? In 2020, I pledged that Northwell would redouble its efforts and remain a leader in diversity and inclusion. I am taking this commitment further this year and, with the strength of our diverse workforce, will address healthcare inequities in our surrounding communities head-on. This requires new partnerships, operational changes and renewed commitments from our workforce. We need to look upstream and strengthen our reach into communities that have disparate access to healthcare, education and resources. We must push harder to transcend language barriers, and we need our physicians and medical professionals of color reinforcing key healthcare messages to the diverse communities we serve. COVID-19’s devastating effect on communities of color laid bare long-standing healthcare inequalities. They are no longer an ugly backdrop of American healthcare, but the central plot point that we can change. If more equitable healthcare is not a top priority, you may want to reconsider your mission. We need leaders whose vision, commitment and courage match this moment and the unmistakable challenge in front of us.
4. How will you accommodate the growing portion of your workforce that will be remote? Ten to 15 percent of Northwell’s workforce will continue to work remotely this year. In the past, some managers may have correlated remote work and teams with a decline in productivity. The past year defied that assumption. Leaders now face decisions about what groups can function remotely, what groups must return on-site, and how those who continue to work from afar are overseen and managed. These decisions will affect your organizations’ culture, communications, real estate strategy and more.
5. How do you vigorously hold onto your cultural values amid all of this change? This will remain a test through 2021 and beyond. Culture is the personality of your organization. Like many health systems and hospitals, much of Northwell’s culture of connectedness, awareness, respect and empathy was built through face-to-face interaction and relationships where we continually reinforced the organization’s mission, vision and values. With so many employees now working remotely, how can we continue to bring out the best in all of our people? We will work to answer that question every day. The work you put in to restore, strengthen and revitalize your culture this year will go a long way toward cementing how your employees, patients and community come to see your organization for years to come. Don’t underestimate the power of these seemingly simple decisions.
While we’ve been through hell and back over the past year, I’m convinced that the healthcare community can continue to strengthen the public trust and admiration we’ve built during this pandemic. However, as we slowly round the corner on COVID-19, our future success will hinge on what we as healthcare organizations do now to confront the questions above and others head-on. It won’t be quick or easy and progress will be a jagged line. Let’s resist the temptation to return to what healthcare was and instead work toward building what healthcare can be. After the crisis of a lifetime, here’s our opportunity of a lifetime. We can all be part of it.
Abstract: This article is a continuation of the theme of ‘What they don’t teach in school.’ The subject of this article is the importance of the development of your decision-making skill.
In my article on career advancement, I observed the correlation between decision-making ability, career, and income level. So how do you improve your decision making or cognitive ability? Several strategies have proven successful for many people. Unfortunately, most of them require doing something that can be very hard – exercising and expanding your brain. Ziglar, Foreman others have argued that most of us rarely use more than 10% of our intellectual capacity at any given time so we have plenty of unexploited potential. So how do you develop your cognitive capability? One thing for me was taking courses in software development. The most challenging course I encountered in college was a computer programming course that I took as an elective! Computers do not do what you intend; they do exactly what you tell them. Computer programming requires the development of precise and highly structured instruction sets. The skillset required to develop computer code has excellent application to problem-solving that goes along with improved decision making.
One day, I was sitting in a conference room in a Catholic hospital listening to debate about whether or not to buy upgraded lights for neurosurgery operating rooms or continue pouring money into a failed clinical program. The longer this discussion went on, the more frustrated I became. Finally, when I could take no more, I accused the leadership team of decision making on a scale that ran from the Ouija Board to a Magic Eight Ball. The reaction that provoked surprised me. I had no idea Catholics did not like Ouija Boards, and I had heard about being excoriated by a Nun, but I had not yet had the experience. I asked the Nun whether or not she thought it was important for a neurosurgeon to be able to see what he was doing in the OR?
Interestingly, some of the young people in the room had no idea what a magic eight ball was. In the ensuing discussion, I reminded the leadership team that their continuing, collective engagement in non-evidence-based, politicized, expeditious decision-making was too often focused on non-strategic initiatives or lost causes instead of pursuing the best interests of the institution and its patients. I told the group that this type of reasoning was one of the primary reasons the organization had come to make my acquaintance in the first place. I am lucky I did not get fired on the spot, but everyone in that room that day learned something. For the leadership team, the lesson was that they had to resolve to do a better job making decisions. I have argued that an organization’s performance, however that is measured, is a direct function of the efficacy of the leadership team’s decision-making. To this day, I keep a Magic Eight Ball on my desk. It reminds me of my innocent dispassion about Catholics’ sensitivity to something as simple as an Ouija Board and my admonition to that leadership team and myself never to stop improving decision-making capability.
Another of the things that have helped me a lot is the study of ‘sadistics.’ I know. The mediocre performance of my first and second articles on this topic is sufficient evidence of how well accepted this idea is. I will not try to sell you on this idea again other than observing that statistics arose from the need for an objective structure to analyze and interpret data. If this is not improved decision making, I do not know what is.
Self-study helps decision making. There are books, articles, and other resources available for research to better understand topics that you do not comprehend as well as you envision. Two of my favorite resources are Wikipedia and YouTube. What you can find is amazing. While some concepts can be hard to read and grasp at first, academic articles can be beneficial, especially if you understand the underlying statistical analysis. In an earlier post, I referenced an article on Normative Decision Theory by Chua. This research looks into how people make decisions in the absence of complete information. When was the last time you had complete information at the point you had to make a decision? There is never enough time or information. Decisions regularly occur in situations where data is incomplete and may be inaccurate. Improving your ability to make better calls in this fog is crucial to leadership at higher levels.
To be sure, collegiate courses help improve your cognitive abilities, although plenty of University programs fall way short of achieving cognitive gains in decision-making ability among their graduates. I think the issue is not so much with what you know but how well you learn to apply academic and theoretical intelligence to real-world problems and challenges. Everyone would be better served if more university programs offered courses focused on applied decision making. My practice has convinced me that one of the critical factors that lead to unacceptable organizational performance is a consistent track record of decision making that does not produce the expected results.
In undergraduate school, I took an elective course on logic. I can’t remember what I was thinking when I made this decision, but like many of my electives, this one ended up requiring a disproportionate amount of time and energy. However, the return on investment has been immense. Not only did I learn a lot about disciplined decision making, I learned how to spot flaws in arguments whose logic is not sound. The study of logic is vital if you ever intend to spend time developing computer code.
Since college, I discovered philosophy, which most liberal arts students have in their core curriculum. You could spend a lifetime studying Socrates, Aristotle, and other philosophers that advanced society by advocating for the cause of beneficial argument and probing assumptions. If you haven’t already done so, I highly recommend you pick up a copy of Plato and let me know if it changes your life.
Finally, the University of Alabama at Birmingham’s Doctorate in Healthcare Administration program mantra is, ‘Evidence-Based Decision Making in Healthcare Administration.’ As is the case in other disciplines, academics worldwide are conducting research in healthcare administration and continually publishing learning that is beneficial to practitioners. Sadly, I cannot remember a case where a leader stopped a team in the process of making a decision and sent them to the literature to find all available evidence on the topic before committing to a course of action. Then they are surprised when things do not work out as they expect?
One of the ironies of healthcare is that physicians and other clinicians are deeply ingrained with objective, evidence-based decision-making theory and practice. One of the reasons that clinicians get so frustrated with healthcare administrators is when they see what appears (accurately) to them be malaise in organizational decision-making. A couple of one-liners come to mind. The road to failure is paved with good intentions. The road to disaster is littered with run-over squirrels.
The upshot of all of this is that your preparation for higher stakes decision making supports career advancement aspirations. I promise you that anything you do to improve your decision-making ability will serve you very well long into the future.
Contact me to discuss any questions or observations you might have about these articles, leadership, transitions, or interim services. I might have an idea or two that might be valuable to you. An observation from my experience is that we need better leadership at every level in organizations. Some of my feedback comes from people who are demonstrating an interest in advancing their careers, and I am writing content to address those inquiries.
The easiest way to keep abreast of this blog is to become a follower. I will notify you of all updates as they occur. To become a follower, click the “Following” bubble that usually appears near each web page’s bottom.
I encourage you to use the comment section at the bottom of each article to provide feedback and stimulate discussion. I welcome input and feedback that will help me to improve the quality and relevance of this work.
This is an original work. This material is copyrighted by me, with reproduction prohibited without attribution. I note and provide links to supporting documentation for non-original material. If you choose to link any of my articles, I’d appreciate a notification.
If you would like to discuss any of this content, provide private feedback or ask questions, You may reach me at firstname.lastname@example.org
This is how the professionals get trapped into SISI – Single Income, Single Identity.
A “mouse” was put at the top of a jar filled with grains. He was too happy to find so much of food around him. Now he doesn’t need to run around searching for food and can happily lead his life. As he enjoyed the grains, in few days time, he reached to the bottom of the jar. Now he is trapped and he cannot come out of it. He has to solely depend upon someone to put grains in the same jar for him to survive. He may even not get the grain of his choice and he cannot choose either. If he has to live, he has to feed on whatever has been put into the jar.
Here are top 4 lessons from this:
1) Short term pleasures can lead to long-term traps.
2) If things are coming easy and you are getting comfortable, you are getting trapped into survival mode.
3) When you are not using your potential, you are losing it.
4) If you don’t take right Action at right time, you will finish what you have and will be in no position to come out.