Conclusion
DISPLAY 7.1 Leadership Roles and Management Functions Associated With Organizational Planning
10. Actively participates in organizational planning, defining, and operationalizing plans at the unit level
Looking to the Future
Because of health-care reform, rapidly changing technology, increasing government involvement in regulating health care, and scientific advances, health-care organizations are finding it increasingly difficult to identify long-term needs appropriately and plan accordingly. In fact, most long-term planners find it difficult to plan more than a few years ahead.
Unlike the 20-year strategic plans of the 1960s and 1970s, most long-term planners today find it difficult to look even 5 years in the future.
The health-care system is in chaos, as is much of the business world. Traditional management solutions no longer apply, and a lack of strong leadership in the health-care system has limited the innovation needed to create solutions to the new and complex problems that the future will bring. Because change is occurring so rapidly, managers can easily become focused on short-range plans and miss changes that can drastically alter specific long-term plans.
Health-care facilities are particularly vulnerable to external social, economic, and political forces; long- range planning, then, must address these changing dynamics. It is imperative, therefore, that long-range plans be flexible, permitting change as external forces assert their impact on health-care facilities. In as far as it is possible, a picture of the future should be used to formulate long-range planning. One reason for envisioning the future is to study developments that may have an impact on the organization. This process of learning about the future allows us to determine what we want to happen. Identifying what may or could happen allows us to avert, encourage, or direct the course of events.
There are many factors emerging in the rapidly changing health-care system that must be incorporated in planning for a health-care organization’s future. Some emerging paradigms include the following:
Further consolidation of hospitals/systems, medical groups, ancillary services, health plans, and postacute providers is expected. “Most consolidation will be driven by the need for critical mass, to fill gaps in the continuum of services offered, to reduce operating costs per unit, to streamline transitions in care, and to expand geographic outreach” (Masters & Valentine, 2015, p. 2).
The tension between “value” and “volume” has reached a tipping point. With growing linkages between expected quality outcomes and reimbursement, health-care organizations must increasingly determine whether value drives volume or whether volume is necessary to achieve value. Morrison (2015) notes that the Centers for Medicare & Medicaid Services has already pledged to convert more payments to value in the next few years, while commercial insurers are following suit, issuing more contracts that bundle payments.
The transformation from revenue management to cost management will continue as declining
reimbursement forces providers to focus on how to maximize limited resources and provide care at less
cost.
Physician integration (an interdependence between physicians and health-care organizations (typically hospitals) that may involve employment, as well as shared decision making and mutual goal setting, is changing practice patterns and reimbursement patterns as hospitals increasingly assume more of the financial and liability risks for what was historically private physician practice. Masters and Valentine (2015) agree, suggesting that the trend of employing physicians will continue for most hospitals and health systems (some estimates anticipate upward of 70% to 80% of physicians could be in employed arrangements with hospitals medical groups, health plans, or other health-care entities in the next 5 years).
Health-care costs will continue to rise, and employers will be challenged to find ways to provide affordable health-care insurance coverage to employees, including cost shifting via higher copayments and deductibles. “Self-insured employers will look for options including direct contracts with providers, shared savings models, spending threshold guarantees, reference pricing for high-priced procedures (e.g., cardiac, orthopedics, cancer), and private exchange plans. In addition, enrollment in public and private exchanges will increase in 2015 as people and companies are willing to experiment and explore new options for health insurance” (Masters & Valentine, 2015, p. 2).
The International Classification of Diseases, 10th revision (ICD-10), meaningful use, pricing, information technology as a whole, in-patient volumes, physician relationships, and physician recruitment will increasingly become intertwined (Weldon, 2015).
The rising cost of pharmaceuticals and ongoing drug shortages will continue to be a problem for US hospitals for at least the next 3 years (Morse, 2015). A 2014 analysis found that drug shortages increased US hospital costs by an average of $230 million annually.
The way in which work relationships are built will need to change because the way we manage systems is changing. For example, health care continues to move toward managing populations rather than
individuals. In addition, hospitals and health-care systems now must integrate long-term care and extended care into their continuum of care (Weldon, 2015).
The ongoing movement away from illness care to wellness care and the use of disease management programs will continue to reduce the demand for expensive, acute care services.
The use of complementary and alternative medicine will increase as public acceptance and demand for these services increase.
The interdependence of professionals and the need for interprofessional collaboration rather than professional autonomy will continue. Thus, the autonomy for all health-care professionals will decrease, including managers.
The shift in framework to the patient as a consumer of cost and quality information will continue.
Historically, many providers assumed that consumers, both payers and patients, had minimal interest in or knowledge about the services that they received. Currently, a change in the balance of power among payers, patients, and providers has occurred, and providers are increasingly being held accountable for the quality of outcomes that their patients experience. Quality data will be increasingly public, and
transparency regarding organizational effectiveness (quality and costs) will be a public expectation.
A transition from continuity of provider to continuity of information will occur. Historically, continuity of care was maintained by continuity of provider. In the future, however, the meaning and
operationalizing of continuity will become predicated on having complete, accurate, and timely information that moves with the patient. For example, electronic health records (EHRs) provide such real-time, point-of-care information as well as a longitudinal medical record with full information about each patient.
Technology, which facilitates mobility and portability of relationships, interactions, and operational processes, will increasingly be a part of high-functioning organizations. EHRs and clinical decision support are examples of such technology because both impact not only what health-care data is collected but also how it is used, communicated, and stored.
Commercially purchased expert networks (communities of top thinkers, managers, and scientists) as well as electronic decision support systems will increasingly be used to improve the decision making required of health-care leaders. Such network panels are typically made up of researchers, health-care
professionals, attorneys, and industry executives.
The health-care team will be characterized by highly educated, multidisciplinary experts. Although this would appear to ease the leadership challenges of managing such a team, it is far easier to build teams of experts than to build expert teams.
In addition, Huston (2014) suggests the following factors will further influence the future of health care:
Robotic technology and the use of prototype nurse robots called nursebots will serve as an adjunct to scarce human resources in the provision of health care.
Biomechatronics, which creates machines that replicate or mimic how the body works, will increase in prominence in the future. This interdisciplinary field encompasses biology, neurosciences, mechanics, electronics, and robotics to create devices that interact with human muscle, skeleton, and nervous systems to establish or restore human motor or nervous system function.
Biometrics, the science of identifying people through physical characteristics such as fingerprints, handprints, retinal scans, voice recognition, and facial structure, will be used to assure targeted and appropriate access to client records.
Health-care organizations will integrate biometrics with “smart cards” (credit card–sized devices with a chip, stored memory, and an operating system) to ensure that an individual presenting a secure ID credential really has the right to use that credential.
Point-of-care testing will improve bedside care and promote more positive outcomes as a result of more timely decision making and treatment.
Given declining reimbursement, the current nursing shortage, and an increasing shift in care to outpatient settings, home care agencies will increasingly explore technology-aided options such as telehealth that allow them to avoid the traditional 1:1 nurse–patient ratio with face-to-face contact.
The Internet will continue to improve Americans’ health by enhancing communications and improving access to information for care providers, patients, health plan administrators, public health officials, biomedical researchers, and other health professionals. It will also change how providers interact with patients with consumers increasingly adopting the role of expert patient.
A growing elderly population, medical advances that increase the need for well-educated nurses, consumerism, the increased acuity of hospitalized patients, and a ballooning health-care system will continue to increase the demand for registered nurses (RNs).
An aging workforce, improving economy, inadequate enrollment in nursing schools to meet projected demand, increased employment of nurses in outpatient or ambulatory care settings, and inadequate long- term pay incentives will lead to new nursing shortages.
Such paradigm shifts and trends change almost constantly. Successful leader-managers stay abreast of the dynamic environments in which health care are provided so that this can be reflected in their planning. The end result is proactive or visionary planning that allows health-care agencies to function successfully in the 21st century.
An example of such visionary planning was the 2015–2020 Federal Health IT Strategic Plan. This plan represents the collective strategy of federal offices that use or influence the use of health information technology (IT) in the United States and sets a blueprint for federal partners to implement strategies that will support the nation’s continued development of a responsive and secure health IT and information-use infrastructure (“Federal Health IT Strategic Plan Released,” 2015) (see Examining the Evidence 7.1).
EXAMINING THE EVIDENCE 7.1
Sources: Federal Health IT Strategic Plan 2015-2020 released. (2015). American Nurse, 47(5), 9.
U.S. Department of Health and Human Services, Office of the Secretary, Office of the National Coordinator for Health Information Technology. (2015). Federal health strategic plan 2015–2020.
Retrieved November 16, 2015, from https://www.healthit.gov/sites/default/files/federal-healthIT- strategic-plan-2014.pdf
The final strategic plan reflecting input from more than 400 public comments, collaboration between federal contributors, and recommendations from the Health IT Policy Committee identified the following strategic goals and
objectives:
Goal 1: Expand Adoption of Health IT
• Objective A: Increase the adoption and effective use of health IT products, systems, and services
• Objective B: Increase user and market confidence in the safety and safe use of health IT products, systems, and services
• Objective C: Advance a national communications infrastructure that supports health, safety, and care delivery
Goal 2: Advance Secure and Interoperable Health Information
• Objective A: Enable individuals, providers, and public health entities to securely send, receive, find, and use electronic health information
• Objective B: Identify, prioritize, and advance technical standards to support secure and interoperable health information
• Objective C: Protect the privacy and security of health information Goal 3: Strengthen Health-Care Delivery
• Objective A: Improve health-care quality, access, and experience through safe, timely, effective, efficient, equitable, and person-centered care
• Objective B: Support the delivery of high-value health care
• Objective C: Improve clinical and community services and population health Goal 4: Advance the Health and Well-Being of Individuals and Communities
• Objective A: Empower individual, family, and caregiver health management and engagement
• Objective B: Protect and promote public health and healthy, resilient communities
Goal 5: Advance Research, Scientific Knowledge, and Innovation
• Objective A: Increase access to and usability of high-quality electronic health information and services
• Objective B: Accelerate the development and commercialization of innovative technologies and solutions
• Objective C: Invest, disseminate, and translate research on how health IT can improve health and care delivery
The first two goals of this plan prioritize increasing the electronic collection and sharing of health information while protecting individual privacy. The final three goals focus on federal efforts to create an environment where
interoperable information is used by health-care providers, public health entities, researchers, and individuals to improve health and health care and reduce costs. With this plan, the federal government signals that, while we will continue to work toward more widespread adoption of health IT, efforts will begin to include new sources of information and ways to disseminate knowledge quickly, securely, and efficiently.
LEARNING EXERCISE
7.1
Forces Affecting Health Care
I
n small groups, identify six additional forces, beyond those identified in this chapter, affecting today’s health-care system. You may include legal, political, economic, social, or ethical forces. Try to prioritize these forces in terms of how they will affect you as a manager or RN. For at least one of the six forces you have identified, brainstorm how that force would affect your strategic planning as a unit manager or director of a health-care agency.Proactive Planning
Planning has a specific purpose and is one approach to developing strategy. In addition, planning represents specific activities that help achieve objectives; therefore, planning should be purposeful and proactive.
Although there is always some crossover between types of planning within organizations, there is generally an orientation toward one of four planning modes: reactive planning, inactivism, preactivism, or proactive planning.
Reactive planning occurs after a problem exists. Because there is dissatisfaction with the current situation, planning efforts are directed at returning the organization to a previous, more comfortable state. Frequently, in reactive planning, problems are dealt with separately without integration with the whole organization. In addition, because it is done in response to a crisis, this type of planning can lead to hasty decisions and mistakes.
Inactivism is another type of conventional planning. Inactivists seek the status quo, and they spend their energy preventing change and maintaining conformity. When changes do occur, they occur slowly and incrementally.
A third planning mode is preactivism. Preactive planners utilize technology to accelerate change and are future oriented. Unsatisfied with the past or present, preactivists do not value experience and believe that the future is always preferable to the present.
Proactive planning is dynamic, and adaptation is considered to be a key requirement because the environment changes so frequently.
The last planning mode is interactive or proactive planning. Planners who fall into this category consider the past, present, and future and attempt to plan the future of their organization rather than react to it. Because the organizational setting changes often, adaptability is a key requirement for proactive planning. Proactive planning occurs, then, in anticipation of changing needs or to promote growth within an organization and is required of all leader-managers so that personal as well as organizational needs and objectives are met.
LEARNING EXERCISE
7.2
What Is Your Planning Style?
H
ow would you describe your planning? Which type of planner are you? Write a brief essay that describes your planning style. Use specific examples and then share your insights in a group.Forecasting
A mistake common to novice managers is a failure to complete adequate proactive planning. Instead, many managers operate in a crisis mode and fail to use available historical patterns to assist them in planning. Nor do they examine present clues and projected statistics to determine future needs. In other words, they fail to forecast. Forecasting involves trying to estimate how a condition will be in the future. Forecasting takes advantage of input from others, gives sequence in activity, and protects an organization against undesirable changes.
With changes in technology, payment structures, and resource availability, the manager who is unwilling or unable to forecast accurately impedes the organization’s efficiency and the unit’s effectiveness. Increased competition, changes in government reimbursement, and decreased hospital revenues have reduced intuitive managerial decision making. To avoid disastrous outcomes when making future professional and financial plans, managers need to stay well informed about the legal, political, and socioeconomic factors affecting health care.
Managers who are uninformed about the legal, political, economic, and social factors affecting health care make planning errors that may have disastrous implications for their professional development and the financial viability of the organization.
Strategic Planning at the Organizational Level
Planning also has many dimensions. Two of these dimensions are time span and complexity or
comprehensiveness. Generally, complex organizational plans that involve a long period (usually 3 to 7 years) are referred to as long-range or strategic plans. However, strategic planning may be done once or twice a year in an organization that changes rapidly. At the unit level, any planning that is at least 6 months in the future may be considered long-range planning.
Strategic planning forecasts the future success of an organization by matching and aligning an organization’s capabilities with its external opportunities. For instance, an organization could develop a strategic plan for dealing with a nursing shortage, preparing succession managers in the organization, developing a marketing plan, redesigning workload, developing partnerships, or simply planning for organizational success.
Strategic planning typically examines an organization’s purpose, mission, philosophy, and goals in the context of its external environment.
Some experts suggest, however, that value-based payment, an increased need for cost cutting, quality mandates, and the need for increased operational efficiencies will require a reconfiguration of how strategic planning is done in most health-care organizations (Jarousse, 2012). Instead of focusing on the external environment and the marketplace, health-care organizations will need to look closely at their competencies and weaknesses, examine their readiness for change, and identify those factors critical to achieving future goals and objectives.
This assessment should begin with gathering data related to financial performance, human resources, strategy, and service offerings as well as outcomes and results. Feedback from senior leadership, the medical staff, and the board is then needed so that consensus can be obtained from stakeholders regarding the organization’s strengths and weaknesses. Then an action plan can be created that strengthens the
organization’s infrastructure. The assessment concludes with an evaluation of how well the organization is achieving its goals and objectives and the process begins once again (Jarousse, 2012).
SWOT Analysis
There are many effective tools that assist organizations in strategic planning. One of the most commonly used in health-care organizations is SWOT analysis (identification of strengths, weaknesses, opportunities, and threats) (Display 7.2). SWOT analysis, also known as TOWS analysis, was developed by Albert Humphrey at Stanford University in the 1960s and 1970s.