The Unhealthy Hospital Case Study

Categories: Case StudyHealth

For a healthcare set up it is very much important to maintain the financial system in balance so that the customers and the stakeholder’s interests are well attended. In a customers point of view one looks for the best service and the results possible from a hospital and on the other hand the stakeholders look for the best possible profit they can gain from the business. This is the point where a competent hospital or a healthcare manager comes into picture.

In this case the healthcare set up is going through a rough stage where in an increasing cost of healthcare facilities like the equipments, pharmacies etc is indirectly affecting on the quality of care provided in the hospital which is ultimately bringing down the annual revenue each year. A budget of 70million dollar has to be approved and there are a lot of issues to be considered

For starters

After careful evaluation the whole building has to be renovated at least to make it look a little more aesthetic and acceptable, so that the patient is comfortable with the space and the facility provided.

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The leaking pipes cramped space and the look of the healthcare set up will have a direct impact on the customers. Since the financial health of the hospital is deteriorating, uplift is necessary. At present the demands from the health workforce regarding the expansion of the neonatal ward, a new operating theater for the department of surgery an MRI machine for the radiology department is not an option to consider.

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For the emergency department a full time physician seems to be an important issue which needs to be attended at
the earliest.

The hospital is already running in a loss so high tech services might be a bad option to consider at this point of time.

The clinics in suburbs were of great help for people of low income community. So the mayor of the city had a very good hope and relation with the hospital and he helped them in getting funds from the council. This was an obligation to completely close down the clinics. There is a political pressure involved. But the situation is out of hand and may be its better to shut down some branches which are not doing well or which has a very negligible patient inflow. This would help in cutting down some expenses.

Introducing a bus service is an unnecessary expense at present situation so that’s again not an option to be considered. DR. Susan Russel’s suggestion is fair but considering the report of the clinics so far with declining number of patients, it seems to be an expensive suggestion

Dean Pellegrini suggestion is very interesting and very much worth having a look at. According to his 1st option- Moving the hospital to a good neighborhood which has potential customers with health insurance would change the present financial situation of the hospital. He also suggests that the present hospital should be converted into a mini hospital with just the basic requirement and services. This way both the purposes will be served. He seems to be pretty sensible in suggesting that later on depending on the situation the old hospital can be turned into a nursing home or any specialized services could be added. It would be very beneficial. The second option what he has suggested is more acceptable to the society but very much of a problem to the board since it is not at all a profitable option, but this option would keep the hospitals mission and the very reason of the hospitals existence alive, which is to serve the community in need who could not receive a good care else where, but by doing so it would completely destroy the hospitals revenue year after a year.

Ellen Schall suggestions are also considerable and acceptable,
involving all the related people to own the responsibility of the hospital success. This will definitely lead to a very good decision and will help in getting a better solutions. The public welfare organizations, the government or a council member, pharmaceutical companies, insurance companies are also important here. Making them all sit together and discussing the problems would lead to a much better and acceptable solution.

The business community, advocacies, private and public agencies might also be involved in meetings. By doing so, a broader sense of the problems could be projected and arriving at the solution can be made easy. May be this might open up a chance for a financial, political, professional aid to the hospital. The companies might be willing to give more discounts on the products such as pharmacies, surgical equipments on a contract basis. The public or the private organizations, business community people might be willing to offer a financial aid, councilor the government might think of some changes in health policy etc.

This will be a good option overall

Kieth f safian had a different perspective towards the problem.

According to him closing the clinic would give a serious blow to the community it serves, which is an absolutely a fact. All he meant was that it will give a negative impression on the hospital and this will in turn reflect badly on the Hospital reducing its annual revenue even more. Having a strong and good relationship with the government, colleagues and the community it serves is to be given an equal priority. He is true in saying that Blake’s Memorial will never be able to compete with St.Barnabas since their motive is completely different from that of the Blakes Memorial hospital.

Concentrating more on the clinics would give Blake’s Memorial a large coverage on the low and middle income community to get more inpatient referrals win the confidence, improve the relationship and the monopoly over the service it provides to these communities.

An effective evaluation of the clinics productivity and the necessary changes depending on the clinics performance is essential. He adds that “One should consider the long term goals against the short term constraints”.

Jane Delgado concentrates on 3 things in the comments which looks very useful

The 1st one is the understanding of whom the hospital will serve. The 2nd one is to change how the clinic work without any unreasonable costs and the 3rd and last one is to develop more tailored analysis of the hospital’s operations. He also says that we should concentrate on the community it serves. The market and mission of the Blake’s Memorial and the St. Barnabas are completely different so there is no question of competing with the numbers and figures with each other. The approach should be independent. According to him Dr. Susan Russel’s suggestion were good and states that regardless of the income and the geography hospital should consider creating locally based preventive healthcare centers which is politically correct and financially lucrative. He also states that Blake’s hospital should provide “High Touch” care and not “High Tech” care.

Clinics should be considered as an extension of the hospital and not like an appendage which means it should be like a cooperative support system to the hospital and not like a peripheral cost centers which drains resources from the hospital. He says these clinics must be like a point of entry to the patients, once they enter to the clinic system Blake should provide them with the necessary basic treatment and the routine follow up and those who need special care or high tech facilities with advanced technologies, should be referred to the St Barnabas. This will have a positive impact on the customers towards the hospital. An analysis of the requirement of the employees should be made and the necessary cuts along with it. If needed changes should be made strategically to maintain a good quality of care. The loss of staff because of the changes is inevitable. One should think about the long term profit in such case.

Barnard Lachner states that there should be a meeting that should be conducted with Clara Bryant and Richard Tuttle or any other representative from St. Barnabas hospital who is a bit more sympathetic towards the low income community, the meeting should lay a ground for low income community healthcare so that the responsibility shifts a bit on the government shoulders too. He also states that it is the government which is responsible for the present situation of the healthcare system. It is the health care policies which are making all the changes and the hospitals are paying the outcomes of it.


There are few important steps to be followed for decision making in high velocity environment. 1st one is to Use as much information available as possible, 2nd one is to develop all possible alternatives, 3rd one is to use the advice of all possible counselors and keep the options open, 4th one is to resolve the conflicts using the consensus from all the related members who are involved in the conflicts and the last one is to make an attempt on arriving at a strategic decision with tactical plans. Eisenhardts (1989)

According to my opinion Jane Delgado’s approach seems to be very effective and rewarding. the comments made by him attends all the levels of the Blake’s health care system ie the role of the hospital in serving the community, the role of the clinic and its importance and about the operation of the healthcare. Of course Ellen Schall’s suggestions are not to be ignored, involving as many people in the meeting will definitely help in arriving a better solution as mentioned above.

I would suggest calling a meeting involving the stakeholders (board). Private and public organizations, business community, council or the government, pharmaceutical companies, advocacies, insurance companies etc and discuss the problems in detail with them. Make sure to inform them about the mission of Blake’s Memorial. A collective mind is different from an individual mind since it belongs to a pattern of interrelated activities
among a group of people. This notion has been used to describe professional culture in an organization (Bloor & Dawson 1994) the groups like this play a key role in decision making. The multidisciplinary team work has been a trend in modern healthcare systems and is proven good for the organizations. The team can expand the role of an employee beyond the normal role and involve him or her in major developments of an organization.( Janice Lewis Duncan Boldy)This meeting will definitely lead us to something good and useful path. Regarding the clinics

As Jane Delgado mentioned we must consider it as a part of the system which cooperates and provides us an inpatient service not as an extra appendage. By making the patients comfortable and treating them with care will develop a good relationship with the neighboring community and will result in a good patient inflow.

Renovate the clinics and expand where it is necessary, evaluate the reports of Dr. Susan Russel and proceed with the renovation and expansion where it is needed. This way the mission of the Blake’s Memorial will be served and it will be accepted by all the communities and politicians.This will lead to a long term profit.

There is no need to expand or extend the services in the present hospital as of now because of the present situation. This can be done in later stages when there is a need. A careful evaluation of the customer inflow and the requirements of the staffs to treat them should be done. The excess staff should be terminated to cut down the cost. This decision might lead to conflict and the workforce dissatisfaction in the beginning, but ignoring it is very much necessary since this step will be good for the long run.


Bloor G, Dawson 1994 Understanding professional culture in organizational context organization studies 15(2):275-95

Eisenhardt K, Zabracki M 1992 Strategic decision- making Strategic management Journal 32(winter):17-37

Eisenhardt, K. M. 1989. “ Making Fast decisions in High-Velocity Environments.” Academy od Management Journal 32(3): 543-76.

Mintzberg H 1973 The nature of managerial work. Harper & Row New York

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The Unhealthy Hospital Case Study. (2016, Apr 02). Retrieved from

The Unhealthy Hospital Case Study

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