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KELLER HSM 541 Week 6 You Decide Recommendations Memo .pdf


Original filename: KELLER HSM 541 Week 6 You Decide Recommendations Memo.pdf
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KELLER HSM 541 Week 6 You Decide
Recommendations Memo

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HSM 541 Week 6 You Decide Recommendations Memo
You have been the CEO of Middlefield Hospital for 2 1/2 years and finally resolved
the workforce challenges that plagued the hospital when you first arrived. In a
recent meeting, the chief financial officer (CFO) indicated that the financial
performance of the hospital has been deteriorating over the last 6 months. The
hospital is not meeting its budget and he is concerned about the future. The new
facility across town has continued to cut into Middlefield's market share by
admitting more patients. The number of admissions to Middlefield Hospital is
declining each month, and more uninsured patients are seeking services at your
facility. You convene the Middlefield Hospital management team and discover a few
interesting facts, which are identified below.
The payer mix of Middlefield Hospital is comprised of more and more Medicare,
Medicaid, and uninsured patients, and fewer patients have commercial insurance.
This is reducing overall reimbursement and net income for the hospital. The nearby

hospital that competes with Middlefield has opened a wellness center that offers a
comprehensive array of preventative and wellness services to the community. This
facility is attracting young families to seek services at this location. Most of
Middlefield's managed care contracts are more than 2 years old. There are little
reliable utilization and reimbursement data available. No one at Middlefield Hospital
is assigned to manage these contracts or maintain ongoing relationships with
managed care companies. The Joint Commission survey is scheduled for next year,
and there are significant problems with the hospital's quality improvement program.
The health plan offered to employees is getting more expensive each year. In fact, the
costs are increasing at a rate of 20% each year. This is adding significantly to the
hospital's operational costs. The inpatient mental health services and neo-natal
intensive care unit continue to lose money for the hospital.


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