Service Collaboration and Hospital Cost Performance

BACKGROUND

Growing reliance on service provision through systems and networks creates the need to better understand the nature of the relationship between service collaboration and hospital performance and the conditions that affect this relationship.

OBJECTIVE

We examine 1) the effects of service provision through health systems and health networks on hospital cost performance and 2) the moderating effects of market conditions and service differentiation on the collaboration-cost relationship.

RESEARCH DESIGN

We used moderated regression analysis to test the direct and moderating effects. Data on 1368 private hospitals came from the 1998 AHA Annual Survey, Medicare Cost Reports, and Solucient.

MEASURES

Service collaboration was measured as the proportion of hospital services provided at the system level and at the network level. Market conditions were measured by the levels of managed care penetration and competition in the hospital's market.

RESULTS

The proportion of hospital services provided at the system level had a negative relationship with hospital cost. The relationship was curvilinear for network use. Degree of managed care penetration moderated the relationship between network-based collaboration and hospital cost.

CONCLUSION

The benefits of service collaboration through systems and networks, as measured by reduced cost, depend on degree of collaboration rather than mere membership. In loosely structured collaborations such as networks, costs reduce initially but increase later as the extent of collaboration increases. The effect of network-based collaboration is also tempered by managed care penetration. These effects are not seen in more tightly integrated forms such as systems.

Ethics Orientation as a Mediator of Organizational Integrity in Health Services Organizations

Increasing scrutiny of ethical misconduct by federal and state agencies has prompted health services organizations to adopt codes of ethics and institute legal compliance programs. However, there is little understanding of the impact of ethics programs or the manner in which program elements act to enhance organizational integrity. This study examined the effect of five ethics program elements on organizational integrity and the mediating role played by ethics orientation in this relationship. It found that program elements influence organizational integrity by engendering among employees a values orientation, a compliance orientation, or both. Furthermore, program elements that induced both orientations have a larger impact on integrity. These findings have important implications for health services managers involved in designing and implementing an ethics program.

Correlates of hospital provision of prevention and health promotion services

This study investigates the factors associated with hospital provision of prevention and health promotion services. The authors conceptualize the provision of these services as a hospital response to the community health concerns of environmental stakeholders. The response depends on hospital recognition and interpretation of institutional and resource dependence pressures and is related to interorganizational linkages, resource dependencies, and information processing structure. Data for the study came from 3,453 U.S. hospitals. The authors found that hospital provision of prevention and health promotion services is positively related to alliance and network membership, the diffusion of such services among other area hospitals, the use of community health status information, and hospital size. Also, for-profit hospitals provide fewer prevention and health promotion services than not-for-profit hospitals. These findings have policy and management implications.

A stakeholder approach to community health management

Although community health management has become an important issue for health care organizations, there is little information on the roles that they and other community institutions ought to play in this area. This article develops a stakeholder approach to community health management, identifies the set of community health stakeholders, determines their salience to health care organizations, discusses the strategies they use to influence organizational involvement in community health management, and examines the responses of health care organizations. Implications for community institutions, health care managers, and researchers are discussed.

Community orientation in hospitals: an institutional and resource dependence perspective

OBJECTIVE

To conceptualize community orientation-defined as the generation, dissemination, and use of community health-need intelligence-as a strategic response to environmental pressures, and to test a theoretically justified model of the predictors of community orientation in hospitals.

DATA SOURCES

The analysis used data for 4,578 hospitals obtained from the 1994 and 1995 American Hospital Association (AHA) Annual Survey and the 1994 Medicare Hospital Cost Report data sets. Market-level data came from the Area Resource File.

STUDY DESIGN

Multiple regression analysis was used to examine the effects of hospital size, dependence on managed care, ownership, network, system and alliance memberships, and level of diffusion of community-orientation practices in the area on the degree of community orientation in hospitals. The model, based on Oliver's (1991) framework of organizational responsiveness to environmental pressures, controlled for the effects of industry concentration and lagged profitability.

PRINCIPAL FINDINGS

Degree of community orientation is significantly related to hospital size; ownership; dependence on managed care; and membership in a network, system, or alliance. It is also significantly related to the diffusion of community-orientation practices among other area hospitals.

CONCLUSIONS

Degree of community orientation is influenced by the nature of environmental pressures and by hospital interests. It is higher in hospitals that are large, nonprofit, or members of a network, system, or alliance; in hospitals that are more dependent on managed care; and in hospitals that operate in areas with higher diffusion of community-orientation activities.

Employee reactions to managed care

Employee reactions to managed care get less managerial and research attention than organizational reactions to it. This article examines the manner in which health services employees react to managed care and finds that their reaction affects perceived job insecurity, organizational commitment, and job satisfaction. Organization-based self-esteem, role conflict, and supervisory support moderate these relationships. The managerial implications of these findings are discussed.

Clinical decision making--what every non-clinician manager should know but was never taught

The management of a health care system requires making decisions and establishing policies that can affect the process of patient care. Clinicians often complain that these decisions and policies are made by people without clinical training. Clinical knowledge is not a prerequisite for a career in health policy or management. Even graduates of accredited health administration programs are not required to understand the process of clinical decision making or the nature of medical practice. Much of the health services literature advocates a shared decision-making model for clinicians and managers. However, most of the literature focuses on how to involve physicians in management decision making; almost none discusses management involvement in clinical decisions. This paper briefly examines how non-clinician managers can support the clinical decision-making process and then specifies the knowledge and skills required for them to play this role.

Community orientation in health services organizations: the concept and its implementation

The management of community health needs has become a focal point in the drive to contain health care costs, enhance service quality, and improve access to care. This article presents a concept of community orientation that health services organizations can use to provide community-focused care. It also discusses the organizational antecedents and consequences of community orientation in health services organizations and develops research propositions.

Adoption of a time-based competition paradigm into the health care industry

Market and regulatory pressures are requiring health care organizations to find new ways to compete. This article introduces the concept of time-based competition, a strategy adopted by firms in the manufacturing sector to strengthen their competitive positions, as a new strategy for health care organizations. The Just-in-Time technique and set-up time reduction activities are used to demonstrate the adoption of this paradigm by health care organizations. A case study comparing the movement of elderly patient through the health care delivery system under traditional and time-based competition practices is used to illustrate gains from adopting the new paradigm.

Attracting RNs to nursing homes: nurses' work experience and perceived importance of organization and job attributes

Applicant attraction theories stipulate that employment inducements be customized to meet the desires and specific characteristics of potential applicants. This study examined the relationship between nurses' level of work experience and perceived importance of organization and job attributes in attracting them to nursing home jobs. Importance ratings of recruitment factors varied significantly by nurses' level of work experience. Unique variation was attributed to education opportunities, potential for career advancement, compensation issues, benefits, and work flexibility.

Organizational tenure and the perceived importance of retention factors in nursing homes

Health care organizations can avoid substantial turnover costs through retention strategies geared to the varying needs of employees. The study on which this article is based examined retention needs of registered nurses in nursing homes and found that they varied by tenure. Low tenure nurses preferred learning opportunities and advancement potential while high tenure nurses favored work flexibility. Implications for retention policy in nursing homes are discussed.

Why outcomes management doesn't (always) work: an organizational perspective

Insufficient attention to organizational issues has prevented outcomes management from achieving its full potential. This article examines the impact of structural, cultural, and cognitive factors on outcomes management. Organic structures differ from mechanistic ones in regard to the organization and implementation of the outcomes management function. Organizational cultures determine the degree of acquisition, sharing, and use of outcomes information by organization members. Cognitive factors affect the level of member compliance with outcomes management initiatives. This article also discusses managerial implications and develops research propositions.

Market orientation and organizational culture in hospitals

Hospitals have been advised to respond to environmental pressures by changing from a product to a market orientation. Such changes are difficult to accomplish because of the entrenched behaviors and attitudes of hospitals employees. This article proposes organizational cultures as the avenue to a market orientation. It describes the role of hospital culture as an antecedent to market orientation. It also suggests ways to develop and maintain a market-oriented culture in hospitals.