Great business and operational skills are no longer enough for C-suite leaders. Good people skills are increasingly in demand.
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It’s here.
Today, the United States Supreme Court struck down Roe v. Wade.
The ruling is “one of the most consequential in modern memory.”
Across the country, healthcare providers are deeply involved in the private and very public conversations happening in light of the seismic decision.
The questions we’ve been asking since the leak have been answered. This is a moment of divisive and profound emotion. Celebration and relief on one side. Fear and anger on the other. Exhaustion by all as our country is further unsettled.
Hopefully, you’ve done the homework recommended several weeks ago. Either way, here’s immediate guidance.
Speak. To whom and how depends on your community, your culture and position. But the people important to you – your colleagues, nurses, allied physicians and, likely, your community – want to know how today’s decision affects them; how, as an organization, you’re thinking about it and acting on it; and what the longer-term consequences might be.
There are (too) many hot button cultural issues today, some of which healthcare leaders may have strong opinions on but little standing. Weighing in on the war in Ukraine is a local decision.
The redefining of women’s health services, however, is squarely in your lane. It is where your voice is uniquely trusted, needed, expected. Again, whether to have a message on this issue is not optional. Not addressing it – the choice of silence – is a powerful message, too. Choose words.
Here’s where to start:
- Align your team. This issue is divisive enough; your organization should speak now with one voice. Gather your leadership group as colleagues, listening to each other in a spirit of friendship, good faith and a shared commitment to the mission of care. Find that common message.
- Know your record on abortion services. You have an obligation to follow all laws and regulations. You also have a mission to care for those in need. How have you been operating and, now, how will you operate in the context of your state’s environment?
- Equip leaders. Send your managers into team huddles with the tools they need to listen effectively, guide conversations as appropriate, and allow people to express how the news is affecting them while keeping things civil and centered on the common mission.
- Check in with employees. Provide channels for team members at all levels to learn about the organization’s stance and how it affects operations, while leaving space to provide input.
- Support your clinicians. There’s deep concern about the legal risk faced by physicians who provide women’s health services in states with existing or soon-to-be-passed restrictive laws. Get your legal, clinical, financial and marcom teams together to discuss how you’re handling this and how quickly you can move. Then, meet with the clinicians who may be affected to discuss your plans and listen to their concerns.
- Check back with your GR team. Your state officials have been planning for this decision, and it’s a fair bet that your legislature’s and legislators’ plans have been all over the news. Even so, there may be nuance now that the decision is official. You’ll want to know.
- Anticipate “what now” questions. Be ready to speak directly to the questions that are asked, but don’t feel like you must have an answer to every question. This is new. Similarly, don’t get bogged down in discussion on scenarios that didn’t come to pass.
This is a hard moment. We know it demands the very best of each of us as we move through this fractious time, and as you take on this challenge for your organization. Mission, culture, zip code and politics all play a role in how you respond. Why so hard? Because it raises the questions, “Who are we as an organization?” and, “Who do we choose to be?”
We also know this is the latest in a relentless accumulation of hard moments. As you rise to the occasion – again – take care of yourself and your team. And know that we’re in it with you.
Photo by Claire Anderson on Unsplash
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Things have gotten very loud and covered in emojis. Maybe we should reconsider – in both our professional and personal lives.
Ford CEO Jim Farley is creating a real-time case study for legacy brands – like century-old hospitals – on how to disrupt themselves.
These past couple of weeks have elevated (again), the urgency for action on gun violence both as a public health issue and local crisis.
The market tumbled and gridlock at the FTC looks to be broken. Get ready for a wild ride in the world of healthcare consolidation.
Note: This piece was originally published over the weekend in our Sunday newsletter. Want content like this delivered to your inbox before it hits our blog? Subscribe here.
The Big Story: Hospital CEO exits nearly double this year
“Twenty-nine hospital CEOs exited their roles in the first three months of this year, nearly double the 15 chiefs who stepped down from their positions in the same period of 2021.”
What it Means for Healthcare Organizations
(four-minute read)
The doctor is in. But the CEO may be out.
Whether due to retirement, ouster, opportunity or entrenched burnout, we’re in the midst of significant turnover at the top levels of healthcare.
Even before Q1 2022, healthcare executive turnover was high: The hospital sector had the fourth-highest number of CEO exits in 2021 of 29 industries evaluated in a 2021 year-end report from Challenger, Gray & Christmas. The study also found that hospital CEO departures were up 11 percent relative to 2020.
Why? There are a few possible contributing factors…
- Burnout. This one always rises to the top these days. The pressure of shepherding hospitals through the most phenomenally challenging years in modern healthcare history took a toll on CEOs.
- Bowing out. Many CEOs were approaching retirement age at the time of the pandemic. Yet they held off to maintain continuity through the extended crisis. Now they’re deservedly on the golf course.
- Bottom line. Q1 finances were ailing and the outlook is uncertain. “Inflation concerns have some boards looking to new leadership to weather the coming storm,” said Andrew Challenger, whose firm ran the numbers on CEO departures referenced in the articles above.
- Distance. Many CEOs were less visible during the pandemic due to the frantic nature of the work. With less CEO rounding and few opportunities to gather as a system, the separation between leadership and staff only increased. This wouldn’t necessarily directly cause an exit, but could erode support for the exec.
- Hospital M&A continues apace. Elsewhere, hospital closures are happening. That could mean more movement, and perhaps musical chairs with fewer spots.
- The lure of the new. Amid all of this is the attraction to new opportunities outside of the four walls of the hospital. PE money is flowing, and good talent is in demand outside of the acute care setting.
Those are some “whys.” Now let’s flip the script and consider executive transitions, as, well… an opportunity. An opportunity for the board and other leaders to evaluate and retool; an opportunity for the new leader to bring new ideas. If you’re staring down – or anticipating – an executive transition, here are just a few opportunities and challenging either/or options people will be considering, whatever their vantage point – on the board, in the C-suite or leading a marcom team.
For Boards:
- Imagine the organization’s life after COVID-19. Then ramp up with a leader who understands the likely characteristics of healthcare’swinners and losers.
- Debate between retrenchment and adjusting to encompass more transformation and creativity.
- Weigh whether to bring in an outside candidate with fresh perspective but less context, or an internal one with institutional knowledge but possibly a narrower perspective.
- Look for candidates with some risk tolerance. They’ll need it for this new era of healthcare. The person stepping into the vacancy will have a long list of priorities and a chance to not only adjust course for the organization but also potentially help reshape an industry.
- Use the organization’s communications pros to help the board turn vision into a cohesive story that bolsters support for the transition internally and in the community.
For Executives:
- Listen first and intently throughout the organization and community to understand and connect with hearts and minds before making bold moves.
- Balance the financial and operational imperatives, mandates from the board and the opportunity to make changes – or double down.
- Educate the board on opportunities for change and ideas for adjusting the organization’s strategic vision.
- Bring context to clinicians, staff and the community about the challenges of today and the importance of making key moves in time that benefit tomorrow.
For Marcom Leaders:
- Help the new CEO and leaders to push the board to think in new, positive ways about transformation and consider questions that start with, “What if we…”
- Encourage leadership to evaluate, reinstate or rethink how they interact with various stakeholder groups, particularly when it comes to in-person collaboration and events.
- Seize this moment to assess every aspect of the organization. Find the stories that showcase where things are headed and help leadership explain to employees and the community why transformation is necessary and how they can be involved.
- Know that even without a leadership transition, now is a good time to refresh. The past two years have been traumatic, and marcom should help the organization ask the questions, “Who are we today?” “What do we value?” and “How do we work together?”
- Take pride in the critical role that the communications team plays in carrying the emotions of team members through a challenging time. The win? Ensuring people feel optimistic about what’s next and their ability to tackle it.
This piece was originally published over the weekend in our Sunday Quick Think newsletter. Fill out the form to get that in your inbox every week.
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Note: This piece was originally published over the weekend in our Sunday newsletter. Want content like this delivered to your inbox before it hits our blog? Subscribe here.
The Big Story: Rising expenses at hospitals are unsustainable, AHA says
Prior to the pandemic, hospitals spent about 4.7 percent of labor expenses for nurses on contract travel nurses. That figure grew to about 39 percent in January, according to AHA report. The current trajectory for hospital expenses isn’t sustainable.
“The dramatic rise in costs of labor, drugs, supplies and equipment continue to put enormous pressure on our ability to provide care to our patients and communities,” AHA President and CEO Rick Pollack said in the statement.
What Comes Next
It was a dismal first quarter for healthcare providers. Of course there are some hospitals andhealth systems that are in a better spot, getting good marks from Fitch and Moody’s. But on the whole, the numbers have been bleak.
Today, we’re looking at forces currently pushing and pulling the industry and inevitably reshaping the provider landscape. The definition of success here is both idealistic and practical. It is both financial viability and the ability for a system to appropriately deliver on its mission to care for patients. We know the balance sheet must add up, and your CFOs need a clear path to sustainability, but ideals are also good.
So, let’s put the numbers aside for a moment. What will it take for healthcare providers to evolve successfully for the future?
- The hospital becomes the center of acute care, and little else.
- Delivery of care takes place in varied settings, from specialty outpatient clinics to the local grocery to the patient’s home to the patient’s texting app.
- Specialization and expertise will become the watchwords, with health services companies stepping in with innovative, flexible services and private capital contributing resources and a keen operational eye.
- Partnerships will also become more varied and collaborative, with the new hospital working in tandem with other types of healthcare organizations to provide a distributed, yet efficient and high-quality patient journey.
Certainly, there’s a long way to get from today’s messy Point A to an idealistic Point Z, but a shift in what constitutes risk and a willingness to undertake hard change will be critical to sustainability – and maybe allow your CFO to sleep better at night.
Here are our bets on what factors will contribute to a system winning or losing in the new healthcare ecosystem.
Healthcare Winners
The core trait of a healthcare organization that will make it through is a recognition that creative transformation is less risky today than taking a defensive posture. Remodeling, not rearranging furniture, is needed to establish sustainable models of care going forward. Other aspects the winners should consider:
- Value-based care. Fee for service is predicated on, well, services. No volume, no revenue. The decade-long push towards value has likely reached a tipping point when there’s no other option.
- Alignment, not employment. Hospitals are looking at offloading physician groups to PE-backed companies and entering operating partnerships to ensure continuity of care without having their employment contracts on the books. It’s one form of streamlining the labor issue where each entity can focus on managing that which it is best at.
- Private capital. Beyond just staffing models, many traditional provider organizations are looking to sell non-core services like labs and even some specialty practices like orthopedics and cardiology to get them off the balance sheet. Meanwhile, PE is ready with capital to deploy and operational expertise to ensure quality of care and financial sustainability.
- Scale. Certainly, the ability to centralize operational departments – revenue cycle and the like – and standardize others is helpful. In addition, a smaller hospital that aligns with a large system will obviously have access to resources that can help them to stay open. Deals were down in Q1, but assuming the financial pressure continues to build, that trend could very well reverse.
- Low debt. Enough said.
Healthcare Losers
Here, it’s largely the opposite traits. If flexibility and risk-taking wins, rigidity loses. Yes, there are some factors that are tough to control or change – like serving largely susceptible populations. But doubling down on the way things have always been done will only compound those concerns.
- Rigid care models. Better develop that VBC playbook.
- Susceptible populations. Serving a population with a high proportion of at-risk patients is problematic when reimbursement is difficult. The caveat is that this challenge is greater in a fee-for-service mindset. Flexibility and creativity in what it means to provide care can help mitigate this point.
- Being all things to all people. Trying to do too much and spreading the organization too thin when resources are scarce rather than focusing on core expertise.
- Stay the course. All told, continuing to view the hospital as the core of healthcare delivery is a surefire bet for a slide into unsustainability. Defensiveness and cost-cutting can only go so far before quality suffers and the organization is forced to offload services or shut down. Why not do that proactively and productively from a position of relative strength rather than hold a fire sale?
- High debt. Enough said.
This piece was originally published over the weekend in our Sunday Quick Think newsletter. Fill out the form to get that in your inbox every week.
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Firm adds to roster to better guide healthcare organizations through post-pandemic transformation
To keep pace with consistent client growth, the national healthcare strategic communications firm Jarrard Phillips Cate & Hancock has added 11 new staff members in the first four months of the year, according to President and CEO David Jarrard.
Growth occurred across all three client advisory practices and the firm’s professional services team. Headlining the new talent are Jason Poteet, vice president of business development and Abby McNeil, vice president in the firm’s National and Academic Health System practice.
Poteet joins Jarrard Inc. with more than two decades of experience in performance improvement, revenue cycle and revenue growth strategy. Previously, he served as a client solutions leader within the healthcare provider vertical of the global technology companies Wipro and NTT Data.
McNeil is a seasoned marketing and communications expert with an extensive track record helping healthcare brands engage employees and grow market share. Immediately prior to joining the firm, she oversaw corporate communication and public affairs for CHRISTUS Health, including leading their COVID-19 response.
“These are highly-experienced, strong additions to our team,” Jarrard said. “Jason’s background helping healthcare clients identify new avenues of opportunity and strategic growth dovetail perfectly with the goals for our firm as we ourselves evolve and grow. Abby’s track record in helping provider organizations navigate the historically difficult imperatives of the past two years demonstrates her creativity, nimbleness and shared commitment to our mission to make healthcare better.”
In addition to Poteet and McNeil, the number and breadth of the new hires reflects an increasing demand for long-term strategic planning and communications engagements among health services companies, hospitals and health systems.
“While most of the operational challenges borne out of the pandemic have receded, a new wave of pressure is creating uncertainty for healthcare provider organizations,” Jarrard said.
Those pressures include the end of COVID-19 relief funds, the shortage of healthcare workers and recruiting challenges, increasingly tense negotiations between payers and providers and rising costs as part of the inflation seen across the US economy.
“All of these challenges are linked, yet each one has a distinct set of features that must be addressed,” added Jarrard. “Solving for the future is very much a matter of ensuring each leg of the stool is in place operationally, and then communicating about each element of change in a way that bolsters support for the organization both internally and externally.”
Jarrard Inc.’s new team members add to the firm’s ability to be extraordinarily responsive to client needs and the rapidly shifting healthcare landscape, while also helping broaden the depth of specialist expertise available to provider clients. Additional new hires are:
Meg Crowley, senior managing advisor, Regional Practice. Crowley was most recently assistant director of communications at Duke University, where she gained a reputation for developing compelling content for diverse needs and audiences. Crowley also spent time in media relations for a public policy think tank.
Angela MacDonald, senior managing advisor, National and Academic Health Systems Practice. MacDonald is an expert in organizational integration, with a career that spans higher education, law and Catholic healthcare. Prior to joining Jarrard Inc., MacDonald served in multiple roles within the Mission Integration Department of CHRISTUS Health.
Liz Nix, senior managing advisor, National and Academic Health Systems Practice. Nix joined Jarrard Inc. from Vanderbilt University Medical Center where she served in multiple roles, most recently as a learning and development leader, but also including facilities planning and management.
Alison Panella, senior managing advisor, National and Academic Health Systems Practice. Panella focuses on internal engagement, strategy development and operational support. She achieved these skills in part during her eight years at Interactive Forums, Inc. a strategic marketing and research firm.
Hannah Boggs, senior advisor, National and Academic Health Systems Practice. Boggs brings years of experience in program management, talent acquisition, internal communications and internal assessments across healthcare and corporate entities. She came to Jarrard from Northwestern University’s Feinberg School of Medicine, where she was a program coordinator in the Department of Medical Social Sciences.
Nina Buckhalter, senior advisor, Health Services Practice. Prior to joining Jarrard Inc., Buckhalter served as a content strategist for a marketing agency serving nonprofit organizations. There, she developed effective social media and content strategies to position clients as thought leaders as they addressed core barriers to healthcare.
Katie Collins, advisor, National and Academic Health Systems Practice. Collins most recently served in various roles at Performance Health, a sports medicine and rehab company. As a member of the marketing team there, Collins spearheaded data analysis projects and provided project management and change management strategies for internal team members.
Emily Magnifico, project manager, Growth Services Team. An experienced marketer, Magnifico has an extensive background in building and optimizing project management practices. Most recently, she served as project manager for marketing and branding agency Anchour.
Luke Levenson, copywriter, Growth Services Team. Levenson brings a reporter’s eye to the nuanced writing necessary for healthcare marketing and strategic communications. He joined Jarrard from Premier Productions, where he served as a media buyer. Prior to that, he was a publicist for a major music label and freelance journalist.
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Note: This piece was originally published over the weekend in our Sunday newsletter. Want content like this delivered to your inbox before it hits our blog? Subscribe here.
The Big Story: UnitedHealth Posts Higher Quarterly Revenue, Raises Earnings Guidance
“The healthcare and health-insurance giant, the first industry heavyweight to report first-quarter results, posted double-digit revenue growth at both its Optum and UnitedHealth care units.”
Must be nice.
The State of Play
While insurance companies appear to be doing well, our hospitals are staring at some bleak Q1 numbers. Why? Well, consider that:
- COVID-19 relief funds are drying up.
- Patient volumes for many services are below pre-pandemic levels and may or may not recover in Q2.
- Demand for staff exceeds supply. When there’s not enough staff, some patients needing care can’t get it (feeding the problem above).
- The cost of the staff hospitals do have is through the roof and unsustainable.
- Inflation is clocking in at 8.5 percent. That’s producing multiple ripples. Cost-conscious patients may be reluctant to spend to get the care they need – especially for preventative care. And staff pay raises are unlikely to keep up with the cost of living, making retention all the more difficult.
What to do? A traditional response by health systems to these pressures would be to cut costs through layoffs or service closures.
- But many systems already cut services and staff deeply during the pandemic. Few today will let go of staff in such a competitive marketplace.
- The high cost of care is a barrier to all but the most urgent patient volumes. This only becomes more acute during periods or massive inflation, when, pound for pound, everything costs more – whether ground beef or gasoline or medical equipment.
One possible source of at least partial relief is renegotiated payer contracts. We’re hearing from more provider organizations in our network that they’re considering – or undertaking – new negotiations. Payers will likely respond aggressively, and with increasing tension between the two, patients are at risk of getting caught in the middle. And that’s never good.
However, some payers are willing to come to the table in recognition that we’re all in this together and the distinction between payer and provider is merging. Where those constructive conversations can take place, it serves as an example of the wider opportunity for partnerships of all stripes – which also include joint ventures with private equity back partners, shared-service alliances with other systems or outright sales for scale and financial stability.
For health system communicators, get ready for change. Again. Here’s how to brace for it:
- Be at the table. Find the time and the path to being part of the strategic conversations happening in your health system today, across executive leadership, operations, finance, legal and government relations.
- Know your story. In times of stress or change, leadership teams can have multiple stories they want to tell. The perspective of communications chiefs is invaluable to helping leadership stay focused on the core messages while maintaining the agility to respond to the changing environment.
- Be responsibly transparent. Times are still hard. Change will continue. Know that you will need to tell this difficult story and explain some hard truths to the community you serve. But it’s better that you tell the story first than letting someone else twist it for their own purposes.
- Have coffee with a reporter. Build relationships with local media as much as you can. Reporters these days often have wide mandates and cover a lot of topics. That means the nuance inherent to big issues facing the local hospital or health system isn’t always reflected in coverage. Be a year-round resource for local business reporters who may have a byline on the story about your next payer battle.
- Be ready for the fight. The stakes have increased, and payers are pushing hard. Provider organizations want to focus on delivering care, not arguing about money. But that, unfortunately, is necessary.
- Keep the conversation going. Whereas payers are constantly negotiating contracts – it’s their business model – any given hospital is only doing that every few years. Ensure your team is keeping an eye on trends, communicating to stakeholders about what you’re doing as an organization and updating your playbook for the next negotiation.
- Don’t accept a turnkey approach. Payers are working from a thick, and broadly consistent playbook. Still, every story, every negotiation, every community served looks a bit different. As payers are becoming increasingly aggressive, you need to ensure that your plan reflects your unique needs.
- Be grounded. Bring everything back to your mission, your calling and your duty to serve.
This piece was originally published over the weekend in our Sunday Quick Think newsletter. Fill out the form to get that in your inbox every week.