What is the most important issue facing rural hospitals right now?
JF: The statistics about the crisis in rural healthcare are by now well known, but no less troubling. Rural hospitals are closing at a faster rate than any time in the past, and close to 300 of these hospitals are on the brink of closure. The National Rural Healthcare Association estimates that these closures would result in the loss of 36,000 rural health care jobs and 50,000 rural community jobs, causing a $10.6 billion loss to the gross domestic product.1 Rural hospitals are disproportionately disadvantaged by many of the ongoing cuts to Medicare, including cuts to Medicare’s bad-debt program and disproportionate-share hospital payments. Sequestration hit rural areas with older populations especially hard. Federal legislation introduced in both chambers of Congress to alleviate some of these pressures on rural hospitals have received little attention and most likely have little chance of passage.2
What are some of the other challenges in rural healthcare?
JF: Although many hospitals struggle with recruiting physicians, it can be especially difficult in rural areas. Only about ten percent of physicians practice in rural America despite the fact that about a quarter of the population lives in these areas. When a physician leaves a rural community, replacing that physician can take months or even years. Likewise, recruiting experienced nurses – especially med surg nurses – the backbone of most rural hospitals – can be crippling. Residents of rural communities tend to be older, sicker, and poorer than other populations. Obesity, alcohol abuse and use of tobacco is also more pronounced in rural areas. Rural residents also have greater transportation difficulties reaching healthcare providers.3
With all of these challenges, what can a rural hospital do to navigate through these difficult times?
JF: I’m so glad you asked this question, because one of the things I like most about my work in the Small and Rural Hospital division of Studer Group is the opportunity I get every single day to see independent community hospitals not only thrive but outperform – in all metrics – many of the much larger hospitals. The hospitals I get to work with are all led by smart, driven, passionate CEOs who are willing to take the time to build cultures that are change-ready and nimble. These organizations invest in their leaders, listen and support their employees and physicians with purposeful communication using Leader Rounding on Employees, employee forums, and conducting and responding to annual employee and physician engagement surveys. They are working to address physician burn-out with Focus, Fix, and Follow-Up conversations.
In a recent conversation with Terry Hill, Senior Advisor for Rural Health Leadership and Policy at the National Health Resource Center, we asked Terry about how rural hospitals are making the transition to value based payments. Without hesitation, he emphasized that organizations that have made the investment in building strong leaders who are aligned with the organization’s goals, accountable to achieving these goals and able to engage their employees are the organizations that will be successful making it through this transition. It’s important that organizations not jump into what they may view as a magic solution, like participating in an ACO, without first paying attention to assuring that the fundamentals are in place. As he said, “When you have a good structure, changes are easy.”
What is the first thing a CEO can do to build that change-ready culture?
JF: The most important thing for a CEO to know is first, that there are no quick fixes, and second, this “building project” requires an investment of the CEO’s time. Our Evidence-Based LeadershipSM framework always starts with a diagnosis of problem areas. Like evidence based medicine, a plan of care always starts with gathering symptoms, lab results, and imaging studies. From the diagnosis comes the plan. Our experience with most organizations is that they need help with the foundational pieces of building that change-ready culture. Ensuring that leaders are held accountable to organizational goals through an objective evaluation system, and are regularly trained and developed is crucial. Our coaches help guide the organization in pacing and sequencing the other aligned behaviors that are a part of our framework. This is essential to avoid the syndrome of “we did that before and it didn’t work”. Sustaining gains is only possible with appropriate pacing and awareness of how hardwired behaviors are before moving on to the next thing.
Do have any last thoughts you would like to share?
JF: Although this is a very challenging time in healthcare, I also see it as a time of great opportunity to recognize that, as Quint Studer pointed out in “A Culture of High Performance”, people want to do work that has purpose, is worthwhile, and makes a difference. By realizing that only those organizations with great cultures will make it through this transition, I feel honored by Studer Group’s commitment to helping rural and small hospitals build those cultures.
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1National Rural Healthcare Association
2Modern Health Care, “Legislation languishes as rural hospitals struggle”, Shannon Muchmore, October 3, 2015.
3National Rural Healthcare Association, http://www.ruralhealthweb.org/go/left/about-rural-health