You practice at a 320-bed community hospital that has just entered into a newly-formed multi-hospital Catholic health care system. The system board and CEO as well as the St. Francis hospital board have charged the CEO with making cost management her number one priority during the first year of the merged entity. The CEO has already moved quickly to begin consolidating departments and cutting marginal services to reduce costs. She has avoided a massive layoff, but the selective job reductions and various cost control measures have had a perceptible impact on employees' morale as measured by a variety of internal feedback mechanisms. Among these have been very visible internal "town hall" forums in which the CEO has been accused of short-changing patient care.
The CEO is approached by the city administrator to partner with the city in funding and operating a clinic for a relatively large Hispanic population on the outer western edge of your service area. This rather impoverished community is approximately five miles from the hospital. One of your physicians has volunteered her time at a very small store-front clinic for the past three years and has been a strong advocate both for the move to a larger facility with expanded services and for your hospital's active partnership with the city. The current facility has long been inadequate to meet the needs of the community. Up-front costs to your hospital are expected to be in the vicinity of $250,000. The annual contribution would be approximately $300,000. Your health system's and hospital's mission speaks directly to your commitment to improve the health status of the community, and community outreach is one of the organization's explicit priorities.
However, the CEO has another proposal on her desk — from the oncology group at the hospital. They wish to start up, in collaboration with the hospital, a specialty oncology hospital that would not only provide the latest technology, but also conduct cutting-edge genetics research, and offer a very active program of susceptibility testing for various forms of cancer, in particular, breast, ovarian and colon. The oncologists believe that an aggressive testing program and state-of-the-art equipment, together with their reputations, would attract many individuals from the adjoining affluent suburb and from the entire region (especially 6 private-pay individuals and those whose insurance covers susceptibility testing) for the testing itself and also for follow-up care and treatment down the road for those who develop cancer. A state-of-the art cancer hospital will also attract other cancer patients from the area. They see this as potentially very lucrative for themselves and an excellent investment for the hospital. The hospital would be part owner and share in the profits.
As envisioned, Salus Cancer Institute would provide all-encompassing care, from prevention to after-cancer, in one fully-integrated facility, supported by a multidisciplinary team of health professionals, advocates, and counselors. Also on staff would be physicians who are leaders in palliative care, education, and research. Patients and their families would find not only the best evidence-based treatments and new cutting-edge treatments, the latest technology and comforts, but the largest integrative medicine program in the region featuring prayer, meditation and yoga, acupuncture, massage, music therapy, and diet and nutrition counseling. The hospital would also contain a care store, a one-stop location, that would provide cancer patients with special clothing items designed for their comfort, including wigs and headwear, swimsuits, bra and prosthetic fittings for mastectomy patients, skin care products for patients undergoing radiation, and much more.
A further pressing reason for the specialty hospital is that another oncology group in the region apparently is considering doing the same. The advantage that the St. Francis group has is that most of the oncologists trained at a very prestigious university, they are very active researchers and tops in their specialties, they are doing a large number of experimental protocols, and they are relatively high admitters. The group is looking for considerable capital from the hospital to build the specialty clinic. They have insinuated that if the hospital chooses not to participate in this venture they will look elsewhere, and perhaps even partner with the other oncology group. This matter is brought by the CEO to the administrative council of which you are a member.