Reference no: EM132290304

Governing Board vs. Management

Lakeview Hospital Medical Center is a for-profit 250-bed hospital in a small but growing community that is rich with large internet businesses. The governing body Board has recently been overhauled with about half being returning members and the other half being newly appointed. In an effort to have more “outsiders” on the Board of Directors (those with no financial ties to the hospital), the longtime Chairman of the Board, Rick Brennan, and hospital CEO Marsha Choy scoured the surrounding area for experts in certain competencies who could enrich the Board deliberations. They found and recommended an attorney familiar with health care insurance laws, a professor from a state university who use to be a hospital system corporate executive, a local politician who was pushing for implementing policy in the community to improve individual health behaviors, and a former patient who is quite vocal about improving the health services at the hospital.

During the orientation for the new Board members, Rick and Marsha were very careful to address the fiduciary responsibility placed on the Board of Directors. They emphasized how the Board is to set the mission and vision of the hospital and develop matching strategies to propel the organization into the future. The new Board members are very enthusiastic and show great interest in advancing the hospital especially as health care reform takes hold.   During the orientation, though, Marsha made a presentation that showed various performance measures for the hospital, many of which are readily available to the public on the internet. The Board members are dismayed to see how Lakeview falls below the other competing hospitals in their community, even the public safety-net facility. The new Board members pledge that this will not continue under their “watch.” Rick and Marsha start to get nervous about how much involvement the new Board members will have in the operations of the hospital.

During Board meetings, it is clear that there is a big difference between the new and the old Board members. The more senior Board members are reading their reports and making comments but then defer to management on handling the implementation and monitoring of the issues being addressed. The newer Board members feel that they need to get more actively involved to assure change is occurring. The Board members read from one of their ongoing educational pieces on health care trends about executive rounding. They decided that each Board member should visit a particular area of the hospital every month and report back at Board meetings on the staff and patient responses to their inquiries.

The staff is enjoying meeting the new Board members as they make rounds and are not shy about telling them all the things that they think are wrong with the management of the hospital. The newer Board members are concerned over the remarks an urge Rick and Marsha to address these issues at the Board meetings. They try to accommodate the requests but now the Board meetings are running over four hours long and becoming more focused on daily management than on strategic formulation.

Communication is being altered on many levels. The communication between the Board of Directors and management of the hospital has changed from emphasizing being equal partners in the improvement of the hospital to being more hierarchical with management having to provide explanations on the issues raised due to the Board rounds. The more senior Board members frustrated with the shift in their meetings and are starting to be silent during the discussion on these issues and are developing a pattern of leaving the meetings early. The administrative team is telling the employees not to engage the Board members in any discussion that could get them in trouble. And worst of all, improvements have not been demonstrated in the latest public reports.

CRAFT YOUR INITIAL RESPONSE TO THE DISCUSSION BOARD BY USING THE FOLLOWING QUESTIONS AS A GUIDE. IN OTHER WORDS, DON’T ANSWER EACH QUESTION INDIVIDUALLY. ONLY USE THE QUESTIONS BELOW TO HELP FORMULATE YOUR RESPONSE.

Discussion Board Topic Questions:

Do you feel it is appropriate for Board members to be making executive rounds in the hospital? If so, should they alter how they are responding to the issues they are hearing about?

What roles should Rick take on as he tries to address this transformation of the Board’s involvement into operations? What about Marsha’s role?

How should the agenda of the Board meetings be changed to perhaps review the issues being raised yet not prolong the length of the meeting?

Are there other ways the new Board members can be engaged in the improvement process that might not viewed as taking over management of the hospital?