DHA 711 Week 4 Strategic Planning Across Units Example

One Strategy, Eleven Hospitals: Building a Five-Year Network Plan That Cascades to Rural Units Without Erasing Them

[Student Name]

University of Phoenix

DHA/711: Administration of Complex Health Care Systems

Week 4 Assignment

[Instructor Name]

[Date]

The network, its planning process, goals, scorecard, capital decisions and rural strategy are composites written for a model paper; research findings come from the sources cited.

When the network board asked for a five-year strategic plan, the four rural hospital presidents met privately. Their fear was simple: past plans had been written at the academic center and delivered to them. They wanted to be planned with, not planned around. The regional vice president carried their concern to the planning committee, which agreed to design a process that built the system plan from unit assessments upward as well as from system goals downward. This paper describes that process and the plan it produced.

The Planning Process

The process ran for eight months. It began with a data review of market share, demographics, quality, finances and workforce for each hospital. A market assessment examined payer trends, competitors and population health. Each hospital completed its own assessment of strengths, weaknesses and community needs, drawing on community health needs assessments. Stakeholder sessions included physicians, nurses, community leaders and patients in every region.

What the Assessments Showed

The assessments revealed a network with strengths in specialty care and capital and weaknesses in primary care access, rural workforce and care coordination. Rural hospitals faced aging populations, high chronic disease and physician shortages. Payers were shifting toward value-based contracts, and Medicare Advantage enrollment was rising quickly.

Listening Sessions in Rural Communities

The planning committee held evening sessions in each rural town. Residents asked about keeping the emergency department open, getting specialists closer to home and whether the network would close their hospital. A farmer asked why his wife had to drive two hours for chemotherapy. These questions shaped the rural strategy more than any market data, and the committee reported back to each community before the plan was final.

Setting System Goals

The committee used the Triple Aim to frame goals. Berwick and colleagues argued that improving the US health system requires pursuing three aims together, a better experience of care, better population health and lower per capita cost, and that this requires an integrator accountable for all three for a defined population (Berwick et al., 2008). The network set four goals: improve quality and experience, improve the health of the populations it serves, reduce total cost of care and strengthen its workforce.

A Balanced Scorecard for a Nonprofit

To measure progress, the committee adapted the balanced scorecard. Kaplan argues that financial measures alone, even supplemented with ad hoc nonfinancial measures, are not sufficient to motivate and evaluate mission accomplishment in nonprofits, and he describes adapting the scorecard for the nonprofit sector (Kaplan, 2001). The network placed mission at the top, with quality and community health, patient and community experience, internal processes and workforce and learning perspectives beneath it, and financial sustainability as an enabling condition rather than the goal.

Cascading to Units

Each goal cascaded to units. For quality, the system goal of reducing preventable harm became a unit goal for each hospital, such as reducing falls by 20%, with measures on the unit's scorecard. For population health, the rural hospitals took responsibility for diabetes and hypertension control in their clinics. Each unit's scorecard linked its measures to the system's, so managers could see their contribution.

Service Placement Decisions

Strategy requires decisions about where services go. For complex procedures such as cardiac surgery, where higher volume is associated with better outcomes, the plan concentrates services at the academic center and one regional hospital. For obstetrics, where travel time matters, the plan keeps delivery services at regional hospitals and supports rural prenatal care through telehealth and outreach clinics. Emergency and primary care remain local everywhere, because delays in those services cost lives and trust.

Capital Allocation

Capital is allocated by criteria set in advance: patient safety needs, access gaps, strategic fit and return, scored openly so that every hospital can see how its requests compare. Rural hospitals receive a guaranteed share for emergency department, clinic and technology upgrades, so they do not compete directly with the academic center's large projects.

A Value Strategy

The network's value strategy draws on evidence. McWilliams and colleagues followed accountable care organizations through their first three years in Medicare's shared savings program and found that those led by physician groups cut spending more, and more with each year, than those built around hospitals (McWilliams et al., 2018). The network's accountable care organization is hospital-integrated, which may weaken incentives, so the plan gives primary care physicians leadership of the accountable care organization and a share of savings.

Why the Value Strategy Matters for Rural Units

Value-based contracts could reward rural hospitals for preventing admissions, but they could also reduce their volume. The plan protects rural hospitals by counting avoided admissions toward their performance and sharing savings with them, so that success in population health does not threaten their survival. A strategy that rewards keeping people out of the hospital must not punish the small hospitals that do it.

A Rural Strategy

The plan includes explicit rural commitments: maintain emergency departments at all rural hospitals for five years, expand primary care clinics by six providers, create a rural residency track with the academic center, add telehealth specialty clinics and reserve two seats for rural representatives on the system planning committee.

Tensions and How They Were Resolved

Tensions arose. The academic center wanted to consolidate imaging reading; rural hospitals worried about delays. The compromise kept urgent imaging reads local with backup from the center. The academic center wanted to move orthopedic surgery; a rural hospital with a strong surgeon kept its program under shared quality standards.

Governance of the Plan

A planning council meets quarterly to review the system scorecard and unit scorecards, adjust targets and resolve conflicts. The plan is revisited annually, recognizing that assumptions in a complex system will change.

Communicating the Plan

A strategy only works if people know it. The network produced a one-page summary for all staff, unit-specific versions for each hospital and a community version in plain language. Managers held huddles to explain how their units' goals connected to the system's, and the regional vice president visited each rural hospital to walk through its commitments.

Measures of Success

Measures include preventable harm, readmissions, diabetes and blood pressure control, patient experience, total cost of care per member, workforce turnover, rural access, including drive time to primary and emergency care, and operating margin.

Risks

Risks include payer changes that undercut value contracts, workforce shortages and the temptation to revert to centralized decisions when finances tighten. The rural commitments and representation are designed to hold even in lean years.

Conclusion

A five-year plan for a multi-hospital network succeeded in bringing rural hospitals into planning by building from unit assessments upward and system goals downward. The Triple Aim framed goals, a nonprofit balanced scorecard placed mission first and cascaded measures to units and evidence on accountable care shaped the value strategy. Explicit rural commitments ensured that one strategy did not erase the smallest units.

References

Berwick, D. M., Nolan, T. W., & Whittington, J. (2008). The Triple Aim: Care, health, and cost. Health Affairs, 27(3), 759-769. https://doi.org/10.1377/hlthaff.27.3.759

Kaplan, R. S. (2001). Strategic performance measurement and management in nonprofit organizations. Nonprofit Management and Leadership, 11(3), 353-370. https://doi.org/10.1002/nml.11308

McWilliams, J. M., Hatfield, L. A., Landon, B. E., Hamed, P., & Chernew, M. E. (2018). Medicare spending after 3 years of the Medicare Shared Savings Program. New England Journal of Medicine, 379(12), 1139-1149. https://doi.org/10.1056/NEJMsa1803388