Community Hospital Corporation (CHC) is an organization dedicated to the preservation and protection of community-controlled not-for-profit hospitals. Led by president and CEO Mike Williams, CHC has helped hundreds of community hospitals remain independent and sustainable, allowing them to continue their service to their communities without merging with a larger investor-owned institution.
During an in-depth interview, Williams discussed three of the challenges that CHC clients face:
- Strategy development
- Alignment of the medical staff
- Operational efficiency
Williams explained that by first addressing these three areas, hospitals will then have the opportunity to focus on providing optimal clinical outcomes at the least amount of cost, thus giving themselves far more likelihood of success and sustainability.
So, the first question that an organization obviously has to ask is: “What is our strategy for the future?” To address that question, Williams said you must first answer another question: “What is the strategy to create credit worthiness? And then with credit worthiness, where do we go from there?”
Williams explained that credit worthiness is critical for community hospitals, because for any healthcare organization—solo or part of a larger entity—access to capital is reflective of their credit worthiness. Without credit worthiness, an organization’s access to capital is severely limited, and without that access to capital, continued sustainability becomes extremely difficult.
What creates credit worthiness? Williams points to location, operational efficiency, quality outcomes, and strength of board, management, and medical staff. These all factor into a hospital’s credit worthiness. Thus, a strategy needs to be developed and implemented to improve in these areas in order to achieve credit worthiness and secure greater access to capital.
The question that CHC poses to community hospitals that are considering a merger with a for-profit entity is: “Will your credit worthiness be significantly enhanced by that larger organization? Or, can you do something equal to or perhaps even greater than that if you were to do it independently?”
Williams said that while CHC cannot mandate a strategy for its clients, it can facilitate strategic thinking such that the hospital board can better understand their options and then make those decisions themselves.
The second area in which CHC clients are challenged—like so many other healthcare organizations—is in the alignment of medical staff. While recruitment and retention can also be a challenge, the most significant factor in regard to medical staff is their alignment with the hospital board and administration. Williams said, “Once physicians are on board, the challenge is encouraging a mindset and path where outcomes are aligned for the overall success of the hospital.”
The third area that Williams believes is a challenging but essential focus point for community hospitals is operational efficiency. These efficiencies include information technology, revenue cycle, and supply chain. He concluded, “If you have medical staff alignment and operational efficiency, both areas of focus support the overall strategy for the organization going forward.”
Since it’s inception in 1996, CHC has served hundreds of hospitals across the nation through consulting, management, and ownership roles. Williams shared some of CHC’s strategic initiatives over the next few years: “To continue to develop the roadmap for organizations to create credit worthiness and demonstrate optimal clinical outcomes, while learning to be profitable at the level of Medicare reimbursement.”