Ten Aspects of Strong Leadership: Point #6

Up to this point a number of key attributes for leaders have been discussed, with yesterday's discussion on integrity being the most important one in my opinion. But integrity alone will not make you a great leader. I have seen some truly ethical and well intentioned people in a leadership position fail because they did not possess the other skills required. Today we will cover one of those skills.

6) Be transparent

This sounds easy to do, almost a passive exercise. But in reality it is a challenge for most leaders. It goes against many people's natural instincts. Some leaders, particularly insecure ones feel threatened by others. They live by the adage that "Knowledge is power". Actually this is true. But rather than empower all those around them with knowledge, some leaders feel this gives away their power. The more confident leaders tend to share information readily.

Now this can be taken too far. For example I do not agree with the speaker I alluded to in an earlier post who suggested that hospital CEOs conduct their business in the hospital lobby in front of everyone. There are sensitive and confidential issues discussed which must occur in private. But key decisions affecting the organization should be readily shared with all employees on a timely basis.

I used to hold a management meeting for all mid level managers and above the morning after each Board meeting to share all the important issues discussed and decisions made. I also met with all employees at least quarterly (this means covering three shifts) to share the organization's performance measures, both good and bad. Employees loved it. They were surprised sometimes that some not so good news was being shared. But they also took ownership in these performance metrics and improved their overall performance.

By sharing information with all employees you empower them and build their trust. A few may abuse this trust, but they probably didn't belong in your organization in the first place.

More on leadership next week.

Mark Brodeur

Ten Aspects of Strong Leadership: Point #5

As we continue with Chuck Lauer's list of key aspects of leadership, today I want to cover the one that I consider to be the most important.

5) Demonstrate integrity

Being a strong leader requires having a number of skills but none of these mean a thing if they are not based on a foundation of solid ethical standards. How a leader acts in this regard not only directs his or her behavior but also the behavior of all those who are faithfully following. The most dangerous combination is an inspiring and charasmatic leader who pursues an unethical path to quick gains.

Successful leaders are quick to recognize that they do influence the behavior of others who are following them. With this comes an enormous responsibility. It is not alright to say that we have to bend the ethics of the organization to survive in today's environment, or that this is what the competition is doing. Being a leader means you have to stand up for what is truly ethical and setting an example for the organization.

Throughout the years I have seen a number of leaders who posess questionable ethics. They do not all crash and burn. This is not Hollywood. In real life some of these people succeed in the business world. Keep in mind that many of them possess other strong leadership skills. But they are still not doing right for their organization or the community they serve. A few end up on the cover of Modern Healthcare in handcuffs but many other operate under the radar.

At the end of the day a leader must be able to look in the mirror and ask, "Did I do the right thing?".

More on leadership tomorrow.

Mark Brodeur

Ten Aspects of Strong Leadership: Point #4

In the previous posts, the leadership traits have focused on the ability to interact and motivate people. But just as important for a strong leader is the ability to provide a clear direction for the organization and a sense of purpose.

4) Choose a clear mission

Healthcare is very mission oriented. In fact some organizations in the past have focused so much on mission that they did not keep the financial realities in proper perspective and threatened their organization's very existence. Obviously a balance is needed. The old adage "No money, no mission" is very true. So it is up to the strong leader to identify the proper mix of services that will support the organization while fulfilling its overall mission.

This all starts with the organization's mission statement which should be to the point and clear to everyone that reads it so that it can be internalized. I once came to an organization with a mission statement that was a page and a half long. If you read the whole thing it sounded very nice but it did not convey a clear sense of purpose to the organization. Working with the Board we shortened our mission to a single sentence that still expressed what we are about.

But the job of establishing mission awareness only starts here. Once you have a statement that will inspire and direct people, the real work is to make it a living, breathing part of the organization. Everyone from the Board members to all front line staff should not only be aware of the hospital's mission but also see it as a guiding principle for their everyday activities. I had our mission, vision and values framed and hung on the walls throughout the hospital including the Board Room. I had them laminated and put in as the first page of the Board book every month. I went to every new employee orientation and gave a 15 minute talk about what our mission, vision and values meant to us. Even with all of these efforts, there was more that could have been done to make the mission completely internalized in the hospital.

Selecting the appropriate mission that balances meeting community needs with protecting the long term financial viability of the hospital is a daunting task. Getting this mission completely internalized in the organization is even harder.

More on leadership tomorrow.

Mark Brodeur

Ten Aspects of Strong Leadership: Point #3

The third aspect of strong leadership overlaps with the second point that was covered on Friday. It addresses how effective leaders deal with employees.

3) Cherish and respect employees

The first thing that a real leader recognizes is that you can not do it all by yourself. You must rely on others and get your work done through other people. The key is how to properly motivate them. Not everybody gets it.

I once worked under someone who clearly thought that employees were an expense to the organization rather than an investment. His idea of employee loyalty was, "You work hard for me for two weeks then I give you a paycheck and we're even". That was it. No connection beyond that. This was not the enlightened thinking of a great leader. Clearly he thought that employees were totally replaceable. Even in a tough job market like today with many people looking to jobs, this is not the way to inspire employees to put their heart and soul into their work.

As Chuck Lauer says, "Employees who get respect will produce at their highest capacity and make their leader look good". My philosophy has always been to surround myself with the best people I can, Give them the resources they need to do their job and stay out of their way except to support them as needed.

As for front line staff, doing the MBWA that was covered last week is important, but not the most important thing. Letting them in on what is going on and seeking their input is invaluable. For an employee to be able to go home and tell his or her family about some new service coming to the hospital before they read about it in the paper makes them feel empowered and alligned with the organization. This is the kind of employee who will do anything to help the hospital succeed. That is a great gift. Make sure they know how much you appreciate it.

More on leadership tomorrow.

Mark Brodeur

Ten Aspects of Strong Leadership: Point #2

Continuing with commentary on Chuck Lauer's list of leadership traits, today I want to focus on being connected.


2) Don't live in a bubble.


Great leaders listen to their people to gain a variety of perspectives. Some leaders don't realize that they don't need to know everything themselves. I have seen over the years that the best leader is someone that knows what he doesn't know and is not afraid to admit it. The great leaders surround themselves with other smart people and listen to what they have to say.


But getting out of the bubble is more than just this. The great hospital leader needs to leave his office and be visible in the hospital. I heard one speaker advise that the hospital CEO should not even have an office. He should set up at a table in the hospital lobby to be visible to all. Personally I think this is going way to far. But the point is valid.


The term Management By Wandering Around (MBWA) became popular some years ago, and many CEOs spend a portion of their day making rounds to interface with employees as well as patients and visitors. But usually when schedules get busy, this is the first thing to go. Also in a large organization that operates around the clock, it is difficult to be visible to everyone. I had a Board Member once chastise me for not knowing the first name of all our employees. He knew the name of all eight employees at his bank. I reminded him that it is a little tougher with 1,200 employees, some of whom work nights and weekends only.

One final note on being visible to employees. It is not just talking in the hall about kids and grand kids. Employees want to know what is going on and want to know that their feedback about the workplace is being listened to. Making time for this is the really important thing.
Properly respecting employees will be the subject of the next post on Monday.

More on aspects of leadership next week.

Mark Brodeur

Ten Aspects of Strong Leadership: Point #1

In today's tough economic and competitive environment with more scrutiny from all sides than ever before, it is extremely important that hospitals have strong leadership. Just what is it that makes someone a strong leader? What qualities are necessary to be effective as a leader?

Chuck Lauer who for many years was publisher of Modern Healthcare, a prolific author, public speaker and career coach in the healthcare field, offers up his views on what it takes to be an effective and strong leader. Over the next series of posts, I will share these along with my comments based on my personal experience as a hospital leader and my observations of many in the field. Just by paying attention to others you can learn what to do but more often learn what not to do.

1) Leading is not the same as managing


We often use these terms interchangeably but they are dramatically different, just as management and administration are different things. It has often been said that leaders do the right thing while managers do things right. Management entails working within the organization doing things correctly and efficiently while leadership involves setting that course for the managers to follow. Both functions are necessary for the successful operation of a hospital. But a well managed hospital will not succeed if it is not headed in the right direction. A leader is necessary to set the strategic plan for the organization.

The other aspect of this is the ability to get others to follow you once you have set the course. This means that you must be able to inspire others to act. The willingness of others to follow you is dependent on two things: 1) the message itself must be believable and consistent with others values 2) having the charisma to properly convey the message is just as key. Strong leaders handle both of these well.

More on leadership tomorrow.

Mark Brodeur

Ten Practices for Increasing Hospital Profitability: Tip #10

Today we finish commentary on the list of profitability practices put together by Becker's Hospital Review. As stated in the previous posts, the list focuses heavily on physician involvement to improve your bottom line and grow business. Today's tip deals with the managed care side of the business.

Tip #10: Renegotiate managed care contracts

For many hospitals managed care patients represent a significant portion of their business or at least a significant portion of their bottom line. Even though managed care companies have become far more resistant to subsidizing the losses hospitals endure from Medicare and Medicaid, it is essential that hospitals maximize this portion of their reimbursement. Clearly there is no opportunity for improved reimbursement from Medicare and even if Medicaid improves substantially it will just decrease the loss.

As has been previously stated, hospitals must focus heavily on cost reduction. But this alone will not get you where you need to be. You also need to maximize reimbursement. According to Nate Kaufman a well recognized national speaker on this subject, hospitals should be getting 130-140% of costs from their managed care providers. If your hospital is not large enough or strong enough in the market to get these kinds of rates, then you should look at merging with a larger facility or system to improve your negotiating clout.

Managed care contracts should be looked at on a regular basis even if they are not due to expire. A profitability analysis should be conducted by payor and by procedure to find the real winners and losers from a financial perspective. Then focus on renegotiating the losers and get carve outs where needed to things such as orthopedic implants.

When you face managed care providers to improve reimbursement in certain areas do not expect a receptive audience. Despite the significant profits many of these insurers are making compared to hospitals, they will not make concessions willingly. You must know your market clout and be prepared to walk away from the table without an agreement as long as you are in a position where they need it more than you do. They will eventually return to work out a deal.

In closing this series of posts on profitability, there are many worthwhile practices on the list. In today's market it is essential that a hospital explore all possibilities. We are now longer in the era of profitability that some of us remember where sloppy practices could be tolerated and still give you a solid bottom line. Today it is clearly survival of the fittest.

More on this later.

Mark Brodeur

Ten Practices for Increasing Hospital Profitability: Tip #9

As we wrap up the list of profitability practices today and tomorrow, we once again turn to a tip involving the role of physicians. Many hospitals have turned to using hospitalists to manage a significant number of their inpatient admissions, and with great success if handled right.

Tip #9: Consider hiring hospitalists to manage inpatient care

The utilization of hospitalists has grown significantly over the last few years. At first, hospitalists were used primarily at larger institutions. Now you will find them everywhere including small community hospitals. Their use has increased because they help hospitals deal with two important issues: 1) minimizing length of stay and unnecessary testing 2) addressing lifestyle issues of primary care physicians who prefer an office only practice.

Many studies have shown that effective hospitalists can save a hospital millions in costs and generate additional revenue through their practices. Their availability inhouse helps facilitate admissions through the ED. They can significantly lower length of stay and reduce the amount of inpatient testing. Further they can enhance revenue through thorough and appropriate documentation that allows the hospital to maximize coding.

But this assumes that the hospitalist is a skilled acute care provider. I have seen hospitalist programs fail to deliver these returns because the physicians filling this role are the same inefficient providers that they were in their private practice. The point of a hospitalist program is to have the inefficient providers turn their care over to someone effective at managing acute care. Many times the physicians who seem to get lost providing inpatient care are happy to do this and appreciate the opportunity of having a hospitalist. But there are those physicians who refuse to turn over any aspect of their patient's care (inpatient or out). The only advantage of having a good hospitalist program for these physicians is that it provides a good internal benchmark for comparison. If you can show them that their case mix index is lower than the hospitalist's patients yet their length of stay and test utilization is higher, this provides a strong argument to influence their practice patterns.

The second benefit of a hospitalist program is that many of the primary care physicians, particularly the younger ones, prefer not having to deal with inpatient care. I had a family practice physician tell me that he needed only three more office patients a day to match the revenue he got by following inpatients which took over 2 1/2 hours of his day. For him, the decision to support a hospitalist program was easy. Unfortunately for me, he was also a very efficient inpatient provider. But the point is that you can generally improve the efficiency of your inpatient care while making life easier for a number of primary care physicians.

One last note, starting a hospitalist program is usually not free. Most hospitalists do not fully support themselves through billing alone, particularly in small hospitals. There is usually a subsidy involved to get the coverage needed. This must be weighed against the benefits gained to determine the financial feasibility. Most hospitals, including small ones, are finding this worthwhile.

More on the last profitability tip tomorrow.

Mark Brodeur

Ten Practices for Increasing Hospital Profitability: Tip #8

As we approach the end of the profitability practices list, today I want to focus on adding profitable service lines. The key to this is not only knowing their general profitability in most markets but also how they will perform in your particular market.

Tip #8: Consider adding profitable service lines

Building profitability is a combination of becoming more cost efficient and adding new business. You must do both if you are to succeed. Sometimes adding new business to your existing services is not a real option. In that case the only way to get additional business is to add new service lines. Any service provided by a hospital must either meet a critical community need or add to the hospital's bottom line. Ideally a service will do both. But when looking to add new service lines you must not only know that they are profitable in general, but that these needs are not already being met in your market.

Some profitable service lines like bariatric surgery, plastic surgery or hyperbaric oxygen therapy may not be seen as supporting the main hospital mission. But actually they do. It is the profit from these services that help finance those under-reimbursed core services and allow you to treat uninsured patients in your community.

When looking at new service lines, determine what the market needs and where you will get the referrals from. Again you need to be talking to your physicians about their needs and the number of cases they may be referring to the new service line.

Even in an era of shrinking reimbursement for services, there are still some service lines out there that can boost your bottom line. You may just have to look a little harder to find them.

More on profitability practices on Monday.

Mark Brodeur

Ten Practices for Increasing Hospital Profitability: Tip #7

As we proceed through the list of profitable practices, the trend of working with physicians continues. Four out of seven practices involve physicians.

Tip #7: Grow case volume by attracting new physicians to your facility


It is fairly straightforward that new physicians will bring in more cases and grow your profits. Depending on your market this may mean attracting new physicians to live in your community or just getting existing physicians who live in your community to support your hospital rather than the competition. To accomplish this you must really impress the physician with what you can do for them and their patients.

Getting the physician loyalty is not just a matter of throwing money at them. First of course there are Stark issues with paying physicians. But even those hospitals that have directly employed physicians physicians have gotten into financial trouble by not properly structuring their employment contracts. An extreme example is the hospital that built a large hospital based physician practice paying very attractive salaries to recruit top notch physicians. This resulted in a $6 million positive bottom line for the hospital. The problem was that the separate physician practice corporation that paid all the new docs lost $11 million the same year. Needless to say, the corporate structure could not sustain the net $5 million loss and there were dramatic changes the next year.


Attracting new physicians and building their loyalty is a complex and difficult process. Not all physicians are looking for the same thing. But it is safe to say that most of them today are looking for lifestyle over money as long as the money is still well in the market range. Many physicians today also want the security of employment. They are not trained in business and don't want the headaches and uncertainties of hiring staff and doing their own billing. This is why the pendulum has now swung back to more physicians entering an employment arrangement rather than going into private practice.


There are other considerations also such as the amount of call and whether or not hospitalists are available. Again, the physician may be willing to sacrifice some income to have more evenings and weekends available for his or her family. Also do not overlook integrating the physician to the hospital and his or her family to the community. It has often been said that to recruit the physician, you must win over their spouse. You want to not only bring the new physicians to the community but keep them satisfied with their decision for years to come.

More on profitability tomorrow.

Mark Brodeur