Reference no: EM133476886

Terry Blaze, the 45-year-old president and CEO of Midvale Community Hospital, rose early on Monday morning. A busy schedule of meetings and several major issues that would require full attention and careful decisions lay ahead. While getting dressed, Blaze thought about what to say to two county commissioners at a breakfast meeting in a local restaurant at 6:30 a.m. The county coroner had called Blaze the previous Wednesday, asking if Midvale Community Hospital would permit the coroner's office to use some of the hospital's facilities. As a 500-bed teaching hospital with more than 2,000 full-time employees and a medical staff of 450 physicians, Midvale was the largest of the four hospitals located in the metropolitan area, which had a population of about 400,000. Recent budget reductions for the coroner's office by the county commissioners had prompted the coroner's request; he was searching for ways to run his office on a reduced budget by drawing on the goodwill and resources of other community organizations.Blaze had scheduled the meeting with the commissioners to see whether they were aware of the coroner's request. Blaze was relatively open-minded about the situation, wanted to maintain the existing good relations between the commissioners and the hospital, and wanted to respond to the needs of the community, provided that the hospital's basic objectives were not jeopardized or its resources inappropriately used. However, getting caught in the middle of the county's political problems could be disastrous.At 7:30 a.m., Blaze attended a campaign fund-raiser breakfast for the state senator who represented the district in which Midvale was located. Blaze spoke to the senator about how the state's recently announced Medicaid payment reductions under their managed care program would affect Midvale and asked the senator to use his influence to try to have funding levels increased. After circulating among the other guests, Blaze went to the hospital. As soon as Blaze arrived at the office at 8:15 a.m., the executive secretary, Ms. Billings, mentioned that Dr. Smith wanted to see him. Dr. Smith, president of the PSO, composed of physicians, dentists, podiatrists, and clinical psychologists having privileges at Midvale, insisted on speaking privately with Blaze about a problem involving a staff physician before the scheduled 9:00 a.m. meeting of the PSO executive committee. Blaze immediately called Dr. Smith, and at the end of the conversation wondered whether it had been a correct decision to tell Dr. Smith to handle the problem as he thought appropriate. Relations between administration and the PSO are always delicate, but this time it seemed best to let Dr. Smith handle the situation and keep Blaze informed.At 8:30 a.m., the vice president for operations arrived and accompanied Blaze to the hospital's conference room. All department heads were present. Because of a recent decision by Blaze and the board to establish a satellite facility in an adjacent county, most departments would be expanded, work loads would be increased, and coordination mechanisms between the hospital and satellite facility would need to be developed. Blaze explained the reasons for the decision, described the planning that had occurred before the decision was made, indicated how Midvale would work with the state planning agency in obtaining a certificate of need, and described how it would affect Midvale and its patients, as well as other area hospitals. Blaze asked the department heads to inform their subordinates before the official announcement was made to the press on Wednesday. A question-and-answer session followedBlaze arrived at the 9:00 a.m. PSO executive committee meeting 10 minutes late and found that it had been postponed until the next day. Because the next meeting on the day's schedule was not until 10:00 a.m., Blaze returned to the office and asked Billings to hold all calls. Blaze had given considerable thoughtover several months to the governing body's directive that options be evaluated for expanding the scope of the hospital's services, particularly in light of the government's attitude favoring competition among HSOs, the actions of other area hospitals, and the area's newly formed HMO. Mindful of the hospital's resource constraints, rising costs, and changing patient mix, as well as the continued tightening of Medicare and Medicaid reimbursement, Blaze was concerned about accomplishing the hospital's objectives during the next 5 years in this changing environment. Particularly worrisome was the restlessness of some members of the PSO, who wanted new services and an on-site medical office building.Blaze recalled the discussions that had occurred at past governing body and management executive staff meetings. After weighing the options, Blaze realized that the hospital would need three feasibility studies to be performed by external consultants. Blaze dictated a memo to the vice president for operations and the assistant vice president for planning, instructing them to begin studies for expansion of the hospital's cardiac services and the addition of 34 psychiatric beds and a physicians' office building adjacent to the hospital. Blaze did not approve a study for a regional burn unit because this service, although desirable, would contribute less to the hospital's objectives than the others, and limited resources meant some projects could not be undertaken.At 10:00 a.m., Blaze met with the chair of the department of psychiatry. Blaze informed him of the feasibility study, but the meeting also continued negotiations about making the psychiatry department chair a salaried position. This would be the first such position in the hospital and would set a precedent with long-term implications.At 10:30 a.m., Blaze interviewed a finalist for the position of director of marketing. At 11:00 a.m., Dr. Loren, who had requested clinical privileges, arrived for a meeting. It was a long-standing policy for the president of the PSO and the CEO to interview all those seeking privileges.At 11:30 a.m., Blaze returned telephone calls that required immediate attention. The first was to a governing body member whose husband was being admitted for minor surgery. The second was to a former patient with a complaint about his statement. Billings told Blaze that the former patient had already spoken to patient accounts but was still dissatisfied. Blaze spoke briefly with him and gave assurances that the matter would be rectified. The last telephone call was to the director of human resources. They decided that the human resources director should accept the mayor's invitation to serve on the health department's personnel evaluation task force. This would require approximately 8 hours per week for 6 months, but they agreed it would help the hospital and community.As was customary, Blaze had lunch in the hospital cafeteria and circulated among the staff before and after eating. It was a simple yet effective way to stay in touch with them.Two major meetings were scheduled in the afternoon. From 1:00 to 3:00 p.m., the budget committee reviewed next year's operations and capital expenditures budgets. The executive staff and controller had prepared options for review. Among those Blaze approved for presentation to the governing body were an increase in the number of nursing service employees, a reduction in the equipment budget, and the annual pay increase for nonprofessional personnel that had been discussed previously. Blaze had positive relations with the governing body and told the executive administrative staff that the recommendations would likely be approved. However, a source of displeasure was last month's adverse overtime budget variance and the cost overran on supplies. Both were unacceptable because census and patient days werebelow expectations. Blaze firmly told the senior managers to monitor their areas closely and report variations weekly.The second meeting that afternoon was with the governing body task force on diversification. Near the end of the meeting, Blaze told them about ordering the physicians' office building feasibility study and told them they should be thinking about incorporating a for-profit subsidiary to own and manage the office building. The major consideration was how reimbursement would be affected by allocating overhead to either the not-for-profit hospital or the for-profit subsidiary. The board task force asked Blaze to include these revenue-cost implications in the feasibility study.On returning to the office at 4:00 p.m., Blaze approved the agenda for Friday's weekly senior management staff meeting, gave Billings several items for the agenda of the next governing body meeting, and returned phone calls. At 5:00 p.m., Blaze left the hospital to attend a 5:30 p.m. area hospital executives' council quarterly meeting. The meeting featured a presentation by the new dean of the medical school located in Midvale about how her plans would affect teaching hospitals and their medical education and residency programs. During the half-hour drive to and from the medical school, Blaze dictated several letters and memoranda and took a cell phone call. Blaze went to a restaurant at 7:00 p.m. for dinner and left at 8:00 p.m. to attend a United Way trustees board meeting. At 10:00 p.m., Blaze returned home and did paperwork for an hour before retiring.

QUESTIONS

Terry Blaze engaged in activities related to the functions of management and roles of managers.

- Identify which of Blaze's activities relate to the management functions and managerial roles presented in this chapter.

- Use the environmental portion of the management model:

1. Identify internal, interface, and external stakeholders with whom Blaze interacted and

2. Identify other environmental forces that affected Blaze, as well as Blaze's actions that affected the environment.