Blake Memorial Hospital in Marksville recently hired Bruce Reid as their new CEO. The hospital and its clinics are not generating enough income. The hospital’s costs is rising, the quality of care is declining and is not generating enough revenue to cover the expenses. Bruce Reid was given a $70 million budget to improve the financial health of Blake Memorial and improve the quality of healthcare services. He was allowed only less than a week to finalize the budget and present it to the board members.
The most difficult issue Mr. Reid had to address was the losses being incurred by the hospital’s six off-site clinics.
If he decides to close the clinics then that would help with preventing the loss of incomes. However, the hospital had a responsibility to serve the uninsured patients in the community in those clinics. Closing the clinics would also anger the city Mayor who supported the hospital when it first decided to open them.
The Mayor even threatened to have Blake Memorial’s tax records reviewed if the clinics are closed. In this situation Bruce Reid needs to utilize his strategic management skills to come with a solution to the daunting problem at hand.
Bruce Reid needs to convince the board members that the clinics needs to stay open and serve the low income population in the community. At the same time he needs to come up with a plan to make the clinics more profitable for Blake Memorial. The best strategic plan is to present a plan that is long range and focuses in the budget for the next few years.
Currently the offsite clinics are losing money and they are also the cause of the funds being diverted away from the hospital’s in-house services. Te best option for Mr. Reid is to start with making a plan for the short term problems such as the problems with the clinics.
He should invest some of the money from the budget and upgrade the clinics. By upgrading the clinics the members of the community will feel more confident to acquire service from those clinics for their health care issues instead of going to other clinics in town. It will attract more low income patients as well as paying patients who help generate income for the hospital. A portion of the budget should be invested in technology that help determine the eligibility of the patient’s insurance and process the billing to ensure payment.
In order to attract privately insured patients the clinics needs to improve the quality of care and become more efficient in their services. Finally, he should move the hospital’s outpatient services to the clinics so it helps generate more income and also allows the hospital to provide better efficient and quality in-patient services. This move will also help increase the inpatient referrals to the hospitals from the clinics and Blake Memorial will be able to create a healthcare network of their own, a first in the community of Marksville.
It is also important for Bruce Reid to create a good relationship with all the internal and external stakeholders on Blake Memorial. One such stakeholder is Commissioner of Health Services of Marksville, Clara Bryant. Also Dr, Susan Russell who is the director of clinics if Blake Memorial. Both of these women want to promote the clinics and improve the services to the low income families of the community. Keeping the clinics open will further help Blake Memorial to campaign for more funding from the community with the help of these women and the Mayor of Marksville.