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How to Analyze Healthcare Cases Before Obamacare Was Passed

Plenty of past cases related to healthcare organizations can look mind boggling to solve. Laws have gone through tremendous changes. Today cannot be applied to yesterday. This is true especially in the case of healthcare organizations. They are usually hard hit by the ever evolving rules and regulations. Their business model is volatile also Yet when studying healthcare administration you will be asked to solve hospital cases of the 90's. Your only source for how to do it would be the course materials, but unfortunately, they do not fully speak about the past. Most textbooks now like to discuss Obamacare.Unless stated in the syllabus, Obamacare should not be used to judge such past cases. Then, how to approach to solve them?

The answer is that you have to go back to the rules and regulations relevant to the time of the case. Journal articles are your best friends here. Using them, learn about the business model of the organization mentioned in the case. Solve it as if you are actually from that time. Below is an example of how to do it. It is based on strategic management and uses a specific format. You can override them to come up with something different.

Emanuel Medical Center: Crisis in the Health Care Industry Case Analysis

Emanuel Medical Center, which happens to be the only independent hospital in Turlock, has entered into a turmoil of uncertainty coming mainly from external environment. It can be taken care of, but before we can discuss how to do so, it is important to understand the climate within which it is operating.

Assessment of the Current Situation

1. Regulatory: The American Hospitals are subjected to strict regulations from both federal and state governments, requiring health professionals to understand and satisfy them. But the trend shows it is not easy. One of the biggest challenges is found within the data sharing regulation of Medi-Cal. It is so complicatedly designed that the hospital employees and the plan overseers cannot work through it without the help of the electronic database, causing massive errors in the data collection related to demographics of the patients and those who are eligible to receive Medi-Cal coverage (Shinkman, 2001).  

2. Political: The lawmakers have been contemplating on whether tax exemption policy designed for nonprofit hospitals should be discontinued because of their ongoing strategy of increasing prices of their medical services which in turn makes them identical to those that are for-profit (Wood, 2001). Resentment for such hospitals is growing even within local governments who unable to tax their profit, have been identifying them as free riders (Wood, 2001). Both the groups are ignoring the increasing expenditure which triggers such price hike.

3. Economic: Economic downturn is in the air (McCuen, 2003). One of its biggest effects is loss of jobs which in turn has link to loss of private insurance and increase in Medicaid enrollees. The recession has a tendency to make people conservative about where they spend their money. To them, a monthly medical checkup session may seem worthless, decreasing the demand for preventive care. The college students, on the other hand, are more focused on education expenses. It is usually seen that the economic downturn compels them to choose universities and majors that promise quicker graduation at an affordable cost (McCuen, 2003). This way the demand for medical degree which can take several years to complete and are usually offered by expensive universities is lowered, causing the shortage of staff for the hospitals. 

4. Social: The avoidance of the monthly checkup means people remain susceptible to serious health complications. When one becomes a bigger problem, they are left with no choice, but to rush to emergency department. Meanwhile, there is a rise in the number of physicians opting out of Medi-Cal. This is making it difficult for the beneficiaries to get access to treatment (Benko, 2003). Their final option is emergency department where they cannot be rejected because of EMTALA.  

5. Technological: Biomedical technology is progressing at a faster rate. Microelectronic devices are becoming the norm in medical treatments (Allan, 2002). That said, when it comes to information technology, healthcare industry is very much behind (Bates, 2002).  

6. Competitive landscape: Among all the competitors, only Tenet has one hospital nearest to location of EMC. But since it has for-profit business model, it may not be very attractive to those who have Medi-Cal or no insurance. Apparently, there is an instability within the healthcare industry, bringing about uncertainty about what to expect next. The unstable nonprofit hospitals of California have been trying to cope with it by partnering with each other (Biel, 2002). This is visible in rivals of EMC.

5. Strategies confronting the organization: Due to a wide variety of regulations, EMC has intensive record keeping task. Unfortunately, it does not seem to be taking advantage of the information technology which has facilitated it in other hospitals (Shinkman, 2001).  Additionally, EMC has taken a big financial risk by implementing a strategy of paying higher wages to employees at the time of economic downturn and uncertainty within the healthcare industry.

Key Issues to Address

• Shortage of health professionals is one of the biggest issues for EMC. This is not compatible with the increasing number of patients the hospital is getting. Those who are already working probably are feeling its stress which in turn is affecting the way they treat the patients. 
• EMC is very slow at implementing new technology. There is a serious need for it especially in emergency and administration departments.
• Marginal profit is another issue the hospital should address. The two issues described above have link to it.

Alternatives to Address the Key Issues

• EMC can file an application with National Health Service Corps to get them to investigate whether its county can be made eligible for the title of health professional shortage area. If the result turns out to be positive the hospital will be able to attract affordable nurses and highly specialized physicians coming from foreign countries or are trying to get their university loan waved (Full, 2001). The benefit of this is lowering of cost, allowing an opportunity to invest in the strategies of technology implementation and business expansion. 
• The hospital can choose to redesign its structure by creating flexible working schedules, introducing career development programs and automation within the system, and making management reachable to all employees. This is another way of attracting physicians and nurses (Upenieks, 2003). The utilization of this option fully, however, can be time consuming. Also the tight financial condition of the hospital may compel the management to work on each at a slower pace. This option may require collaboration with the hospital staff for ideas. Interestingly, it can satisfy the hospital’s strategy of retaining physicians and nurses while maintaining quality. 
• Another option EMC has is the internship program for the nurses. One big advantage of this is that it requires the interns to work full time while receiving a base salary of registered nurses (Currie, 2002). This can be taken as cost effective, but the program requires to be designed, influencing the tactical plans of the hospital.
• For technology, EMC can approach donors of Silicon Valley. Even during the economic downturn, the new millionaires of the region are willing to support various organizations through their philanthropic work (Streisand, 2001). The hospital can collect the donation from them to buy electronic tools to automate various medical services, enhancing efficiency within the system.

Recommended Solutions

• CEO Moen should first try approaching National Health Service Corps for the health professional shortage area title. If their investigation result shows that the county is not eligible for it the option of redesigning the internal structure of the hospital must be utilized (Currie, 2002). In order to make it possible, hospital staff must be gathered for a brainstorming session. The aim here should be listing of areas where weaknesses such as delay and confusion exist. Once listed, the hospital staff should be allowed to share their input on how to eliminate them to welcome restructuring of the system for better work flow. In order to cope with the marginal profit, the redesign should be done slowly through collaboration. It should be able to satisfy the strategy of quality workforce and recruitment of new healthcare professionals. 
• For the technology, taking advantage of the easy access to philanthropic millionaires is recommended. Of course, here CEO Moen is the one who has to take the step. Some Silicon Valley young millionaires are focusing mainly on charitable work (Streisand, 2001). Networking with them will prove to be financially and technologically beneficial for EMC. However, to make it possible, the CEO has to spend time out of the hospital. This means the executives working under him will have to take up some burden of the paperwork that he normally does. For a while, thus, they will experience stress. The received donations should go towards investment in electronic record keeping tools and telecommunication devices that facilitate medical services. These two can reduce a number of problems such as errors in data recording and delay in work within the departments. Eventually, the implementation of new technology will cut administrative costs while attracting new physicians and nurses.

References

Allan, R. (2002). Technology advances will revolutionize healthcare. Electronic Design, 50(20), 64.
Bates, D. W. (2002). The quality case for information technology in healthcare. BMC Medical Informatics & Decision Making, 2(1), 7-9.
Benko, L. B. (2003). Leaky umbrella. Modern Healthcare, 33(25), 34.
Biel, M. (2002). ENVIRONMENTAL UNCERTAINTY AND COLLOBORATION AMONG CALIFORNIA NONPROFIT HOSPITALS. Journal of Health & Human Services Administration, 25(1/2), 166-203.
Burda, D. (2002, September 30). It's really brother vs. brother. Modern Healthcare. p. 20.
Currie, D. L., & Vierke, J. (2000). Making a Nurse Intern Program Pay Off. Nursing Management, 31(6), 12.
Full, J. M. (2001). Physician Recruitment Strategies for a Rural Hospital. Journal of Healthcare Management, 46(4), 277.
McCuen, R. H. (2003). Academia in a Declining Economy. Journal of Water Resources Planning & Management, 129(6), 441-442.
Shinkman, R. (2001). Data dilemmas. Modern Healthcare, 31(24), 24.
Streisand, B. (2001). The new philanthropy. U.S. News & World Report, 130(23), 40.
Upenieks, V. (2003). Recruitment and Retention Strategies: A Magnet Hospital Prevention Model. Nursing Economics, 21(1), 7.
Wood, K. M. (2001). Legislatively-Mandated Charity Care for Nonprofit Hospitals: Does Government Intervention Make any Difference?. Review of Litigation, 20(3), 709.

The Past Struggle of US Health Insurance

Did you know that the American system of health insurance was inspired from European countries? In Europe, during the 1800 and 1900, concern about the protection for workers gave birth to what is known as sickness insurance. Not all the European countries, however, had the same insurance system. While France's was more linked to health of employees, Germany was lucky enough to have a nationally mandatory one. Attempt was made to have similar national insurance in US, but it never went anywhere. The step was first taken by the Socialist Party in 1904. The main group, however, was American Association for Labor Legislation (AALL) which simply wished to give a revamp to capitalism instead of killing it. In 1912, a social insurance structure crafted from the European one received endorsement from Theodore Roosevelt, candidate of Progressive Party. But he ended up losing to Woodrow Wilson and that left the insurance without a strong promoter.

In 1915, AALL proposed another model of insurance system to help the working people and their family members get medical treatment and sick pay followed by benefits connected to maternity and death. According to the model, the insurance was to be mandatory and the fund for it were to be generated from the employers, workers and states. American Medical Association partially supported it, but doctors lost their interest in it because it threatened their earning and rights. American Federation of Labor was already against it because they feared that it would not allow the workers to be economically independent. Compensation back then was already expensive for which even the employers began to reject the model. It still had some support from handful of physicians. But once World War I began, many of them joined the army which finally obscured the debate, killing the model. Reform could still happen, but there was just one problem: Germany, with whom the war began, already had the mandatory national insurance system, hinting that it would be disgraceful to have something similar to it in the US. That was enough to end the debate.

In the end, the private groups came forward to fulfill the medical payment needs of people. Blue Cross was the first one to start the hospital insurance system according to which the company agreed to cover 21 days of hospital care of 1,500 teachers of Baylor University. For this, they charged $6 per individual. During the Depression, the support for such health insurance plans gained popularity among the hospitals. It was their way of having payment cushion from medical services.

In 1939, another attempt was made to start the mandatory national health insurance system. To prevent it from turning into reality and also to slow down the control of average Americans from prepaid plans, Blue Shield took birth offering physician based insurance plans. But it was mainly during World War 2 when employers began getting more aggressive about offering insurance to employees. The main reasons were freeze in wage and WWII drafting which lessened workers in the job market. The plans worked as great attraction factors. But once the war ended, because of the unions' power to bargain better, employer based insurance plan began to grow across the nation. By 1954, Internal Revenue Service declared that employers could use pretax money to make payment for their employees' health insurance premiums, making insurance system more attractive to employers.

So when did federal government get involved in the system? It was during 1965. The entry was made through Medicaid and Medicare mainly to help those who were left out by the private insurance companies. They were the people with risky preexisting conditions, disabled, senior citizens and underprivileged population. But introduction of the programs were a tug of war. Various proposals of how they were to look like were brought to table by the politicians and medical associations. American Medical Association liked the idea of federal and state governments subsidizing the policies of private insurance for the senior citizens so they could get physicians, prescription medications and go to hospital for care. Meanwhile, John W. Byrnes, Republican representative from Wisconsin rejected state's participation in the program. Another proposal came from Johnson Administration according to which social security was to be used to cover hospital insurance for the senior citizens. Then came New York Republican Senator Jacob Javitz who endorsed federal funding for states to provide medical care to underprivileged and senior citizens. Eventually, all these ideas became part of the bill of Medicare and Medicaid. In other words, federal government funded the Medicare program and Medicaid became a program of state and federal governments.

In the 70's a new crisis showed up in the form of skyrocketing healthcare expenditure due to rise in price of medical treatments and large number of Medicare, and Medicaid patients. On the contrary, back then, the insurance system was based on fee-for-service according to which payment was made for each service the medical professional provided to a patient. Eventually, the government began feeling its heat. Healthcare expenditure rose to $28 billion.  In 1973, to fight it, Health Maintenance Organization Act was passed. It worked to establish Health Maintenance Organizations, slowly replacing fee-for-service with managed care. The fund for the program came from federal loans and grants, and policy which required employers to offer HMO option to employees if they are 25 or more in their companies. Managed care did not, however, get a warm welcome from Americans. Only in the 90's its popularity grew.

During this time, Clinton Administration began pushing for another healthcare reform in the form of Health Security Act. It aimed to make it possible for all Americans to have insurance through universal health care system without the use of any government fund. At the same time, it made no attempt to take away the power of private insurance companies. It merely formulated a plan of utilizing managed competition by using factors of market competition and manged care. That said, through the Act, National Health Board was to limit federal and local spending and control the increase in premiums. Health alliances were to offer a wide range of health plans to employees and those without work in each region of the country. Competition was to be created through these options. As for the structure of the plans, they were to provide some promised benefits and their cost sharing accounting was supposed to be fixed. Employers with 5,000 or less employees were to to buy plans from health alliances. But yes, Health Security Act required all employers to give their employees a great amount of benefits. Assistance was available for the small businesses and low income families. There were many other provisions within the bill and one of them was to decrease the payment going to providers.

Health Security Act turned controversial. Sure it faced challenges from employers, health insurance companies and Republicans, but also the Democrats. Soon even the Americans turned away from it. Much of the blame for the failure of the bill was placed on its incomprehensible nature. The bill had 1,342-pages. Yet it was difficult to understand the expenses and regulations laid out by it.

Policies are made to respond to crisis. Patient Protection and Affordable Care Act of President Obama had the same aim. Arrival of 2000 began showing new problems in healthcare. Throughout the next 8 years, research studies began to show Americans' dissatisfaction with the health insurance companies. More and more bankruptcies began to have link to medical expenditures. It turned out to be 50 percent. Premiums rose dramatically, but quality of medical treatment still was poor. It is believed that Bush administration had no time to pay attention to them because of war on terror.

4 Elements to Use Against Medical Negligence in Court

First of all, what is negligence? In simplest sense, for a professional, it is the inability to show reasonable care while handling work, resulting in damage to his service buyer. It is considered a civil wrong and thus, goes by the title of tort of negligence.

Law strictly expects healthcare professionals to abide by legal standard of care deemed necessary and sometimes common sense.

The main definition is given below. Standard of care is their way of preventing malpractice while protecting the patients.

Most rules found within standard of care may vary from state to state. However, there are still those that are common in the entire nation. By law, one can sue healthcare providers for negligence. But in order to win in the court, they must show evidence of the following:

1. Duty: Healthcare providers directly involved in treating the patient are required by law to perform it carefully. Absence of meeting is not an excuse here. What this means is that even if the patient never meets the pathologist who is working on his blood samples he owes duty to him. He must try his best to be as correct as possible. Owing of duty, however, does not end here. When the healthcare provider is seeing a pregnant patient he owes duty to her fetus too, making it important for him to make sure that nothing happens to it during a treatment. Another in the line is the bystander. Now this can be the patient's family member or relative who witnesses a case of medical negligence and gets psychologically or physically affected by it or sees the treatment cause damage to the patient. Lastly, healthcare providers owe duty to anyone who gets into their office and hospital. They do not have the right to put the average visitor's life in danger. Now if a case of negligence goes in the court jury is not going to sit and brainstorm the ways the doctor could have avoided causing the damage. Instead they will look into the  standard of care.

2. Breach of duty: This is connected to not abiding by the legal standard of care. This is where the provider is doing his action of negligence. However, when it comes to proving it  in the court, technical knowledge about it becomes necessary. The plaintiff, thus, is required to be accompanied by an expert who can show on his behalf how the provider violated standard of care. If one is not presented defendants get the chance to win. They also bring in their own expert. In the end, it becomes the battle of experts. However, in cases where the connection between the defendant and damage is overly obvious, no expert is necessary. The legal term used for it is res ipsa loquitur. An extreme example of this would be leaving scalpel inside the stomach of the patient during surgery.

3. Causation: Here the plaintiff has to prove how the breach of duty led to damage he is bearing. The court may not find the defendant guilty only if the damage or death was apparently predicted and imparted to the plaintiff.

4. Damage: This one involves showing the evidence of the damage. Now this is not limited to physical injury caused by the breach of duty. In fact it can be anything ranging from employment loss to medical treatment expenses that the plaintiff is bearing because of what the provider did to him.

Hospital Governance Structures Explained in Details

In United States, a medical institution must satisfy a set of requirements detailed by American Hospital Association in order to be recognized as hospital. One of these requirements is governing board.

Professionally, the chief of executive (CEO) is the middle link between the hospital staff and top layer where the governing body stands officially responsible for the overall arrangement of their medical services. They do not exactly oversee every aspect of the day to day business. The attributes of the governing body usually vary according to the hospital ownership types and their missions such as making profits, clarity and fulfillment of the government policies. And with that their duties in the society vary. In US, we generally have three kind of hospital ownership structures which are: for-profit, nonprofit and public. Here nonprofit and for profit are usually held as private. But it is never easy to handle each. The issues will be discussed below as we go in details about their governance structures.

Significance of what this doctor says is connected to hiring process of each type of hospital

For-profit Hospital 

Generally, for-profit hospitals are also called investor owned. They are business oriented and follow a governance structure similar to those that large private companies follow. With terms being limited, the number of people serving within the board is less than ten and they may be a group of physicians and businessmen accountable to shareholders. It is actually quite beneficial to invest on these hospitals. They tend to generate a lot of profit, allowing the investment to see greater light throughout the years. On the top of that, if these hospitals do poorly and accumulate debt, investors are not required to make any attempt to pay any portion of it. To generate fund, just like a corporation, these hospitals can offer stocks. However, they have an obligation to pay both property and income taxes. Furthermore, they are least likely to get any donation because the government does not allow it to be tax deductible for the donor.

In corporate world, services, quality improvement and location of the businesses are mostly influenced by the mission to make profit. Services that do not work are replaced or discontinued to avoid unnecessary spending and losses. Governance structure of for-profit hospitals goes by this same formula. As a matter of fact, studies show that for-profit hospitals are usually located in urban areas. The aim here is to attract the rich patients. These hospitals offer medical services that have more potential to bring in a good amount of profit, but completely stay away from those deemed financially valueless and because of this, they are more inclined to perform open heart surgery while eluding the idea of establishing trauma center within their premises.

When it comes to oversight, strategic planning and evaluation of performance, the governing boards of these investor owned hospitals score the lowest. Some experts claim it has to do with the small governing body. They say that it is not easy for a small number of people to govern every aspect of the hospital. But research reveals that mortality rate is much higher in these hospitals and this may be associated with the fact that people who suffer from complex illnesses prefer to be treated by these hospitals. As mentioned earlier, businesses focus heavily on profitable services and prefer to improve their quality to attract loyal customers. It seems that this factor is not fully compatible with an organization like hospital. In fact, it backfires in the form of bad reputation.

Certainly, there is nothing wrong in offering treatment for complex illnesses. But by rejecting financially valueless treatments, they take the road to irrationality. The problem is that cures for all kinds of illnesses have yet to be found. So by choosing to offer treatments just for those that have no cure they are attracting only those patients who will not live longer. This actually brings in another negative effect. Businesses focus on profit and quality to get loyal customers. For-profit hospital is known for quality also. However, attracting only terminally ill patients means they fail to garner loyal customers.

For-profit hospitals are notorious for dishonesty. They have been caught more than others with upcoding activities. The meaning of it is that they create fraudulent bills by falsely increasing the prices of their services.

Examples of for-profit hospitals are:
Providence Memorial Hospital (El Paso, Texas)
Saint David's Medical Center (Austin, Texas)
Summerlin Hospital Medical Center (Las Vegas, Nevada)

Nonprofit Hospital 

There are at least two types of nonprofit hospitals. While one is faith based and has mostly church members as directors in the board, the other is run by influential community members or physicians. There is no limit in how many years they can serve. The board consists of more than 10 directors. The aim of nonprofit hospitals is to provide care instead of maximizing profits to be distributed among different investors. Just like for-profit hospitals, they rely on fees paid by the patients. They are extremely good at attracting donations and when needed they can issue tax-exempt bonds. In terms of active duty related to strategic planning, evaluation and oversight, the governing body of these nonprofit hospitals scores the highest. Technically, the directors are more focused on providing value to the community, gaining respect from the governments.

Now what makes these hospitals different from the for-profit is that they do not require paying taxes. The prices of their services are usually lower and sometimes they may even see patients for free. This is one reason why they are known as charitable. They offer a wide range of treatments and have enormous amount of facilities. Studies reveal that they do not only get more patients because of this, but also are heavily challenged by their for-profit rivals and as a result of this, they are now forced to accepting the corporate models. Majority have already done so.

One of the biggest issues of these hospitals is that their governing body is usually overworked. Plenty of reasons are associated with this. First of all, because of the enormous amount of facilities, they need to hire a huge number of professionals. Secondly, since many patients are entering and leaving, the hospitals are always busy. Third, the governing boards consisting of priests are often subjected to criticism coming from scholars. It is thought that since they do not have experience in medical, they cannot make practical decisions. This is connected to these priest mission of providing the value for people through discounted and free treatments. Problem is that healthcare services are expensive. Being overly lenient here means making the hospital financially challenged.

In past studies, this is what often appeared in the conclusion. Nonprofit hospitals used to face a huge amount of financial issues. But at recent time, due to accepting the corporate model, they are making more profit than the investor owned hospitals. This has created another issue. Many critics are now urging the government to take taxes from these hospitals.

The pie chart does prove that government is losing a lot by not taxing the nonprofit hospitals

Some examples of nonprofit hospitals are:

Kaiser Foundation Hospitals (8 states have it)

Shriners Hospitals for Children (Found all across US)

St Rose (Hayward, California)

Washington (Fremont, California)

Public Hospitals 

There is no general way to describe their governing structure. The reason behind this is that there are many different kinds of public hospitals under separate control of different governments. This creates difference in how they are run. Their governing bodies may include third party contractors, local government or public university officials. They usually receive funds from both federal and state governments which they use to provide free medical services to underprivileged population. They can issue bonds to raise money. In many situations, they have the right to bill the patients. It all depends on whether they are treating those with good jobs and salaries. Public hospitals are favorites of uninsured group. Studies show that during economic crisis, these hospitals are more prone to falling under worst setbacks. This is comprehensible in the sense that they depend largely on government fund. The fee they charge sometimes cannot be taken as enough and also its effect is overridden by the free medical services given to underprivileged patients. 

One big issue surrounding the governing structure of public hospitals with the exception for those under the control of universities is slowness in taking decisions and this is said to be connected to promotion of transparency and government policies designed to prevent the directors from abusing their power. Their meetings are usually recorded. There maybe a camera in the room or the transcript is made available. This is what leaves the directors in discomfort. They fear talking openly.

Examples of public hospitals are:
Monroe Community Hospital (Rochester, New York)
Carolinas Medical Center (Charlotte, North Carolina)
Parkland Hospital (Dallas, Texas)