The case, Cooper Green Hospital and its Community Care Plan is a very interesting case, which tries to outline the problems that plagued the hospitals growth and the attempts made by the top management of the hospital to enhance its reach to maximum number of poor and undeserved citizens who were in dire need of medical treatment. This mission of CGH made it stand in front of constant scrutiny from country commission. Media and the community challenges about the quality of care provided by CGH limited its ability to attract patients with private insurance. For the first 2 decades the hospital face increasing budget pressures, cost overruns were a common phenomenon. The hospital was understaffed, under stocked and overflow with patients. Some of the major problems faced by the hospital were balancing cost with maximum access to care, managing employee within budget, performance and demand and simplifying procedures and aligning them with policies.
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The two plans are named as Health first, a traditional fee for service plan and the community care plan , a prepaid membership plan based on family size and income, which would give opportunity to the people to receive quality medical care for at affordable price and with less waiting time. In a scenario where there are constant changes in the US health care system, where managed care was altering how providers interacted with patients funding for care was restricted and many health care systems were using non-physician providers to cut cost, CGH had an opportunity and challenge to attract uninsured patients and outperform its competitors.
In the light of all these issues, the question that posed in front of the top management was, is to move ahead with the expansion plans or hold and improve operational efficiency or give up altogether.
The hospital was understaffed, under stocked and was overflowing with patients. The major problems that plagued the company’s growth were as providing affordable good quality medical services to the indigent population of deficient country, streamlining procedures with polices, managing employees and gauging their performances, declining revenue, decreasing enrollments and under utilization, no upgrading enhancement of technologies, indifferent behavior of some employees towards the patients, inability of the infrastructure to cater to the increasing demands of the out patients section, resulting in long waiting hours and frustrated patients.
The top management needs to make some critical calls on some top level strategic issues. If these problems are not taken care of then the following could be the repercussion:
- Negative revenue
- Dissatisfied patients
- Thrown away by competition
- Loss of goodwill and mistrust among people
- Inability to achieve the mission – providing good quality service at affordable price and enhancing access to care.
- Complete shutdown of the hospital
The directional strategies are undertaken by the hospital to improve its position and enhance its reach and ability to serve maximum number of patients’ starts with the defining of its mission statement vision and goals.
CGH is committed to serve the residents of Jefferson country with high quality health care regardless of ability to pay (“Copper green mercy,”). The hospital strike to attract and maintain a dedicated and compassionated staff of professionals who believe in serving the society and seek to continuously improve the services and adapt to need the changing health needs of the communities. (“Cooper green mercy,”).
CGH is the leader to an evitable and just health care system through excellence, quality, compaction and trust. (“Copper green mercy,”).
Some of the key value statements for the company are commitment to health and well being of those being served expectation, to achieve the highest level of excellence, understanding the vital importance of advocacy for those being served, imbibing creativity and innovation, recognizing the importance of working with the patients and the community and dedication towards providing high level education to health professionals.
The Medicare program was established in 1965 to insure medical coverage for the aged and disabled. It then expanded to in compass other people entitle to social security or rail road retirement benefits and also people with end stage renal disease.
Another provision allowed non covered aged individuals to also benefit from the plan. There are 2 separate programs for Medicare i.e.
Part-A :- Hospital insurance (free of charge)
Part-B :- supplemental medical insurance (against monthly fee)
In 1997 Medicare as a whole covered 38 millions people utilization of Part-A and B was 87% of enrollees. (DeButts, 2010).
Title XIX of the social security act of 1965 gave rise to Medicaid as part of the federal state welfare structure to aid America’s poor population. It allowed federal funding for state run programs. In order to provide basic health service including hospitals in patients and out patients service laboratory and X-ray services and physician services.
In 1998 Alabama Medicaid program provided benefits to variety of population but the majority were for indigent women and children and elderly persons in nursing home. In 1998 15.3% of Alabama’s population was eligible for Medicaid program. The balance budget act of 1997 brought a significant change for the Alabama hospital in the light of ALLKIDS programs.
Health care cost rose at twice the inflation rate from the mid 1980’s to mid 1990’s creating a 1 trillion dollars industry that accounted for 14% of the US GDP. By the end of century the health care industry had grown to more than 1.5 trillion dollar or 18% of GDP. In 1995 nearly 3 quarters of American workers were insured by HMO, PPO and POS plans up from only 27% in 1987. (“The Economy in,”).
By the 1990’s Jefferson Country has become a diversified economy with industries spanning across various industries like Biotechnology, healthcare, engineering and financial sector. As of 1998, the Birmingham metropolitan statistical areas population was approximately 875,000.Jefferson Country population was approximately 652,000.
According to a 1993 survey it was found out that 1/3rd of Jefferson country resident were uninsured. 12 acute care hospitals were located in Birmingham. In 1998 8 out of 12 hospitals reported experienced decline in admission, in patient capacity in the area exceeded demand in order to reposition themselves. (Johnson, 2006). To respond to this and other changes in health care environment many hospitals went in for strategic alliance like the Brook wood Medical Centre, Medical centre East and Lloyd Noland Hospital. The other hospitals spread across the diverse geography of Jefferson are as follows:
- Princeton Baptist Medical centre.
- Montclair Baptist Centre
- Brook wood Medical Centre
- Cooper Green Hospital
- Health South Medical Centre
- Saint Vincent’s Hospital etc.
In the 1990’s there was an increasing emphasis on outpatient care driven by the need to reduce cost and improve technology that would enable more types of care to be delivered on the outpatient basis.
The lack of capital resources with CGH to invest in technology enhancement, new medical renovation led to longer waiting time, patient frustration and declining enrollments. The shortage of examination rooms, clerks, nurses, waiting room space further worsened the patients’ experience.
Sometimes the reason for this frustrated experience was the discourteous and uncompassionate behavior of some of the staffs with the patients. There were some staffs that were very dedicated and loyal and compassionate but some were not interested in their jobs and used to perform below the expected levels and show negative attitude to the patients. The administration made several attempts to improve the employee morale but it was of little use as there remained a core of negative people who demoralized other staff members and angered patients.
In order to provide good quality health care at affordable and fair prices to the poor and needy patients, the hospitals both Non Profit making and profit making should go in for a strong alliance and should complement each other’s competitive strengths and ensure to pass on the benefits of reduced cost, higher advanced technological developments, better quality health care to the indigent population. (DeButts, 2010)
Internal Environment SWOT
- Pool of talented and compassionate staff members who choose to work at Jefferson health systems and believed in its mission and enjoyed serving those in need.
- Turnover of the staff was pretty low
- High overall patients’ satisfaction which averaged about 90%.
- Patients recorded the most satisfaction with issues related to the health care providers. Many patients expressed their gratitude for the care they received. They often remarked as saying they would have no way of obtaining health care without JHS and “God bless CHS”.
- CGS was considered one of the safety net providers across the US because of its mission to provide medical care to the poor.
- Declining revenue of the Hospital
- Majority of capital was funded and only 6% was operating revenue. With this low operating revenue, operations may become unsustainable in future
- Hospital was not able to attract patients who are not insured
- Resources are not adequately utilized
- Inadequate infrastructure to take care of the growing demand in out patients section.
- Managed care was dominated form of insurance in US and enrollment was expected to increase
- Change in the US health care system. Managed care was altering how health care providers interacted with patients, funding for care was being restricted and many health care system were using non physician providers to cut cost. This threw plethora of opportunities in front of CGS.
- Vandalism and violence
- Stiff competition in the health care segment
- Technological advancements along with insufficient capital
- Inability to cope up with competition in the light of technological advancements which made diagnosis of multiple problems possible and insufficient capital.
According to a 1993 survey conducted by CGH centre for community care more than 1/3rd of the resident of Jefferson country was uninsured. Many poor people were delayed getting necessary medical care because they had no health insurance. Some 48 thousand residents have been denied care because they lacked health insurances. On average health care was listed as the 6th most important issue.
This unexploited segment of uninsured population gave an opportunity to CGH to cater to the demands of segment that top management was able to identify this niche market.
In order to serve this niche market CGH and Jefferson country development of health (JCDH) established a working alliance in order to improve continuity of care for the indigent population.
JCDH physician staff privileges at CGH. They also explored the idea of more comprehensive alliance but no plans could materialize before 1999. JCDH operated an extensive health care network to service approx 80 thousand people every year. Health care services were available to people at the cost of service based on their ability to pay. Seminars were also sponsored by the health centres on disease eradication and health promotion topics.
The following actions could be taken in order to resolve the problem faced by the hospital:
- Developing the infrastructure facility so as to meet the growing demands of the out patients segment, as the hospital was designed to take care of the in patient.
- Establishing strategic alliances with some of the top profit making hospital.
- Giving better training and education to the staff so that they can be adequately utilized
- Offer better discounted bundle price/package to the patients so as to attract the insured patients as well. This will help increase the number of enrollments and increase the patient base.
- Increasing operational efficiency and reducing waiting time in the clinic.
- Reducing the dependency on funding and establish more ways to generate operational revenue
- Investing in technological advancements and providing high quality modern medical facilities to the patients
In order to implement the recommendation the following strategies should be adopted
Establish more number of CCP clinics which would take care of in patients demand and reduce the waiting time
CGH can go in for a comprehensive alliance with top performing hospitals just like Brook wood Medical Centre, Medical Centre East and Lloyd Noland Hospital formed an alliance in 1995.
Aligning with the apex health care institutes to provide high quality training to the staff
Involving more non physician providers like registered nurse and practicing physician under the supervision of medical experts.
Motivating the staff to work efficiently by addressing their monetary as well as personal requirements
Increasing the synchronization among the various departments so as to reduce the waiting time.
Giving better offers for both Health First and Community Care Plan to the existing uninsured patients as well as the new insured patients. This will enhance the revenue base and decrease the dependency on funding
Attracting investors by means of more aggressive marketing initiatives in order to enhance the popularity of the CCP concept.
In order to make the CCP success some marketing initiatives were undertaken which did not turn out to be successful
A health fare was scheduled at the site of the first CCP clinic before its establishment but because of construction delay the clinic couldn’t be operational several months after the fare thereby nullifying the impact of the promotional efforts.
The primary approaches to marketing during the first two years were appearances by the top management and staff members at community organization, church groups, schools along with promotional materials placed within the hospital.
The intention of all these marketing activities was to educate staff neighboring communities, social services, uninsured people, small businesses and other hospitals in the area regarding CCP and how to access the service.
Word of mouth had proven to be the promising and reliable avenue of retaining patients.
Due to limited administrated staff no one person was responsible for coordinating the marketing efforts.
Before the commencement of the first clinic focus group were used to assess the membership plan but there were no service to assess the patient awareness attitude or understanding about CGH or CCP.
Benchmarks for Success
In order to ensure the success of the CGH in achieving its goal of providing quality treatment at affordable fees and increase access to care, following strategies/ actions should be adopted / executed:
- Increasing the revenue base by attracting more patients both insured and uninsured
- Taking advantage of the niche market of uninsured population
- Offering better compensation services so that the patients feel that they are getting more for less
- Educate staff members and train them properly so that the patients waiting time is reduced and patient experience enhanced
- Go in for strategic alliances with good profit making hospitals to get access to capital and make necessary investments in technology.
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