High Stakes

The Rise of the Hospital Government Relations Strategist

Here are some uncomfortable hospital realities — check to see if any apply to you:

  • Repeatedly getting hit by reimbursement cuts
  • Unable to influence critical legislative and/or regulatory issues
  • Unsuccessful in certificate of need attempts (your own or opposing others)
  • Floundering or failed partnership efforts
  • No significant external champions willing to speak up on your behalf
  • Your competitor is seen as the savior in the community
  • Not included in desired networks, state-based exchange plan or demonstration projects
  • GR goals not tied to your organization’s business goals

Now ask, are you investing wisely in your government relations department?

In the past 10 to 20 years, we’ve seen an evolution in the hospital government relations strategist. No longer is the role confined to simply dealing with legislative or regulatory issues. Strong government relations is viewed best as a strategic business function, responsible for playing a key leadership role in furthering a hospital or health system’s growth and business goals.

It’s not that your government relations team is going to help you figure out how to go from volume to value, but they need to be at the table for those conversations because there are elements on which they can help.

Think about it. Healthcare providers are becoming more dependent on the government — at the federal and state levels — as a payor. Consider that between 1990 and 2010, Medicaid spending increased from $72 billion to more than $400 billion annually. Today, Medicare covers 48 million people at a cost of $560 billion annually, and costs in the next decade are projected to total more than $1 trillion. Add to that the fact that the rules and regulations through which providers operate are being determined (and changed) by governing bodies at all levels — local, state and federal.

Your government relations team has a piece in most significant areas of your organization, whether it’s M&A, strategic partnerships, winning a certificate of need, or a new hospital or ambulatory care center. Their role is not only in limiting cuts, but also in fighting for increases, working on payor relationships, laying the foundation in markets where you want to expand and so much more.

So, how do you structure a government relations team for success?

Late last year, we published a government relations benchmark report that studied government leaders and their teams across the country. We found many different structures, but the most successful were investing in and positioning their teams to play a key role in strategy.

Some teams reported to the CEO, others to strategic planning, senior counsel or external communications. But it was less about where they reported and more about how they were integrated with the senior leadership team, and included in critical conversations about the organization’s business strategies and overarching goals.

If you answered yes to any of the statements at the beginning of this article, you may consider rethinking how you invest in, staff and structure your government relations department. Check out a recent article I wrote for The Governance Institute to identify the five questions your leadership team should be discussing to assess your GR program.