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Why Do Some Hospitals Fail?

, Why Do Some Hospitals Fail?

Building a hospital is a monumental task for a municipality. Many different kinds of data are needed before construction begins: local demographics, zoning laws, community expectations, local health insurance providers, other healthcare providers, etc. Public and private funding sources must be secured, which often necessitates the creation of a board of trustees that will influence hospital policy over the coming years. Though securing continued funding is important, hospital administrators at poor-performing hospitals often overlook another important aspect of day-to-day hospital operations: the creation and maintenance of a strategic plan. When thinking holistically about hospital administration, having a defined set of values and goals and sharing them among hospital staff is essential. The frenetic pace of day-do-day hospital operations may keep top hospital administrators from creating this vision, and as a result employees may feel more isolated and less sure that the advanced healthcare services they provide are appreciated.


In addition to improving hospital staff morale, a hospital’s strategic plan typically serves several professional roles. For example, if a hospital does not have defined expectations for established staff who are reviewing newer staff, new hospital employees may not receive timely feedback and essential constructive criticism regarding their performance. The individual hospital is an extraordinarily busy environment, and even well-trained new hospital staff may feel overwhelmed. Providing these employees with timely, constructive feedback can help cement their places in the healthcare industry whereas otherwise they may have succumbed to work-related stress. Like new hospital staff, experienced hospital employees may not provide their feedback in a timely manner unless obligated to do so by hospital regulation.


These performance guidelines constitute the backbone of day-to-day hospital operations. In an extremely stressful work environment, there is little time to formulate these practices on the fly. Established procedures help employees save lives (and their own sanity), but many failing hospitals do not regularly address procedural change. Regular staff meetings are advised, as well as an efficient system to receive and implement employee recommendations. Occasionally, hospital administrators and policymakers are distant from day-to-day hospital operations to the point where they can no longer effectively identify when a change needs to be made. Employee feedback from experienced hospital staff helps every employee by ensuring that protocol changes when it needs to, and in a positive direction. Most successful hospitals include at least a few experienced staff on their board of trustees to obtain a direct pipeline into how the hospital is operating day-to-day.


New hospital performance measures have also been recently passed as a result of the Affordable Care Act of 2010, which seeks to make hospitals more accountable for their performance by tying certain metrics directly to how much federal Medicare assistance a hospital may receive. The Affordable Care Act also obligates employers with more than 50 full-time employees to provide health insurance for their full-time staff. Hospitals may see a massive shift in their workforce in response, and a current strategic plan will help employees adjust more quickly to a changing labor market.



hospital administrators, Affordable Care Act, strategic plan, hospital staff

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