Explain how issues related to the regulation of human resources by federal, state and other regulatory bodies affects organizational performance in healthcare management

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Review the model of Strategic Management of Human Resources and describe how it impacts an organization.

3–5 Pages excluding cover page, abstract page, and reference page. Students need to support their work with at least 4 academic or professional peer–reviewed sources published within the past five years.

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Objectives:
Evaluate and explain the role of human resources in healthcare organizations
Examine how human resources can enhance organizational performance in various types of healthcare organizations
Explain how issues related to the regulation of human resources by federal, state and other regulatory bodies affects organizational performance in healthcare management
Here is the Model:

Patient Bill of Rights:

One of the central stakeholders in any health care environment is the patient. The Patient’s Bill of Rights is not as simple as it sounds, and it is also not as universal as it seems. It can take the form of a code of conduct in the protocols of the company, a tort rule, or a law. In any of these cases, it is intended to explain what any patient might be able to expect from the health care providers. It also outlines the patient’s roles and responsibilities with regard to managing his or her own care. The official version (created by the Centers for Medicare & Medicaid Services) was created to start after the Accountable Care Act, but there have been state and local variations of this for many years (Federal Register, 2010). There have also been several versions of this in the Senate and the House of Representatives.

The majority of the versions indicate that the patient has the right to the following:

Fair and equitable treatment
Access to his or her own physician or clinician
To refuse recommended treatment
To be informed about his or her rights, coverage, and the risks associated with treatment
To pay for treatment out of pocket
To confidential treatment
The patient responsibilities vary, but they typically include the following:

Disclosing any and all medical history or pertinent family history to clinicians involved in treatment
Being honest
Asking questions when something is unclear
Keeping appointments or appropriately canceling or rescheduling appointments
Using services appropriately and not abusing the integrity of the clinicians and the staff

Changes and challenges

Changes in Health Care

Health care organizations exist in communities that support their activities. As the needs and demands of communities change, so must the organizations that are dependent on that community. This change is especially necessary for health care organizations. The need to evolve has been proven time and time again in different forms and for different reasons.

Following the end of World War II, the demand was for more hospitals. During the 1960s, communities felt the need to fund health care organizations of all types. Then, during the 1970s, hospitals were faced with government control in the form of health planning legislation and even hospital commissions that determined the amount health care organizations could charge. Planning was replaced with cost controls that, in turn, were replaced with the supposed free, competitive marketplace. During President Clinton’s administration, attempts to create a national health insurance plan were quickly thwarted.

The purpose of these efforts include controlling costs, avoiding costly duplication, improving access, better distributing health care resources, providing a basic health service plan to all Americans, and a few other noble goals. Although strides have been made in most of these areas, there are still many goals yet to be accomplished. It is clear from governmental efforts in the last 60 years that health care regulation is still in transition and more governmental efforts are forthcoming.

Responsibility

It is important to recognize that people working in the health care field have been entrusted with a significant fiduciary responsibility to build, maintain, and provide a quality health care delivery system. A great deal is expected and demanded from health care workers. More specifically, competency and high moral and ethical standards are fundamental. Being a health care professional can command a high salary and a great deal of respect. When these responsibilities and trust are breached, however, that practitioner is liable for his or her actions.

Legal Issues

In the health care field, legal remedies take on different dimensions. In the instance where the accused is a private individual, the range of penalties varies from monetary expenses all the way to the loss of that practitioner’s license. The basis for these penalties is that professionals are held to a higher standard than the rest of the public; therefore, they must be held accountable. When the professional is sued as an employee of a health care organization, the organization then also becomes a party to the action.

For organizations involved in the delivery of health care, a greater level of liability is present in that organization. It is common to find directors of risk aversion in large hospitals who have as their main tasks to identify, mitigate, and eliminate risks. Responsibility to avert risks and situations that may create risk ultimately rests with the board of trustees, which quickly delegates the responsibility to both the clinical and administrative staff running the institution.

On the clinical side, the responsibility for addressing the quality of care starts with various clinical directors who work with committees to determine how well the organization is doing. These committees might address different facets of clinical performance that range from medical records to infection control.

Any concern over the quality of the care that is provided to the public quickly draws the attention of the media and governmental agencies alike. Any abuses by health care organizations are quickly reported, and these abuses create a great deal of interest in the media. Local or state government agencies are quick to respond to health concerns for actual medical problems and for political reasons. This microscopic review of health care organizations is not found in too many other types of organizations.

Challenges

Communities can also pose challenges in health care. Many older hospitals that are built in the inner-city find themselves not serving the populations that now surround them, and they may require action to become more functional. One option is to move the hospital to the suburbs and follow the patient base. A second choice may be to provide a degree of free care or care at a reduced rate. A third choice might be to shut down the institution.

For-profit corporations own many health care organizations. This creates an additional set of responsibilities and legal requirements. Corporations have the intention to make a profit for their shareholders. In health care, the idea of making a profit is one that is regulated carefully. Physicians, for example, cannot refer their patients to a medical program in which they have ownership interests. Profit margins in nonprofit hospitals are exceptionally low in comparison to those in the business sector.

The last 50 years of health care regulation and laws have demonstrated the great amount of turmoil in the industry. Many attempts have been made to address different problems, needs, and demands of health care organizations. It is clear that many more attempts are necessary to evolve the current health care system. The health care industry is far too important to the entire country not to change or evolve.

Healthcare Management

Many medium-to-large health care organizations are led by four key, senior-level functions: chief executive officer (CEO), chief financial officer (CFO), vice president of contracting, and vice president of sales and marketing. The larger the health care organizations, the more complex the infrastructure and hierarchy become. As companies get larger, the roles and responsibilities of senior executives may have a different focus; however, the core duties and responsibilities remain the same.

The CEO’s role is two-fold: to ensure that internal operations support the mission of the organization and to ensure a positive external corporate image that promotes growth. Both the internal culture and the external image are closely linked with the CEO’s personality and style, both personal and managerial. For example, someone who wears a long hairstyle accompanied with 1960s clothing may be labeled a “hippie” with all the presumed characteristics, even though that particular individual may be a very different person that what he or she is projecting by hairstyles or choice of attire. Therefore, one must be conscious of the decisions one makes and how those choices may impact organizational culture. In particular, a negative corporate image to the external community may prevent organizational growth and development.

The CFO supports the CEO. Although currently changing, the role of the CFO is to ensure that the company has enough money to carry out the company’s mission, ensure continued daily operations, support the upkeep of company functions, and ensure the availability of funds for company growth. The CFO plays a critical and direct role in ensuring that the operations of the organization comply with federal and state laws and generally accepted guidelines. Beyond ensuring that the company has enough funds and items accounted for appropriately, the CFO is often the link between the CEO’s plans for company growth and the CFO’s and other senior leaders’ ability to put these plans into action. It is the CFO that primarily influences which plans for growth and development can actually be put into action. Similar to the CEO, the CFO’s personality will impact company culture. If the CFO is a risk taker, the company may work under a less secure financial position than one where the CFO is an ultraconservative, risk-adverse person. The former may lead to periods of uncertainty and poor performance, and the latter may lead to stagnation. Either can lead to success.

Helping to bridge the CEO’s vision and the CFO’s reality are two (among many) senior leaders that help define needs for cash and funding and needs for growth and development. They are the Vice President of Contracting and the vice president of sales and marketing. The VP of contracting has the responsibility for maintaining agreements with vendors, suppliers, and any other entities with which the company does business. The VP of contracting works closely with contractors to ensure positive working relationships and works with the CFO to review the company’s financial position and availability of funds for these relationships. The vice president of Sales and Marketing works with the other senior leaders to assess the CEO’s development plans: If new products or services need to be developed to support growth plans, what relationships and agreements with vendors or suppliers need to be expanded, created, or terminated? What funds are available for these endeavors? Similar to the CEO’s contribution to corporate culture and organizational development, the VPs’ personalities and outlook will also influence how the company responds to new challenges. Having poor vendor relationships or unimaginative selling skills will do little to improve the company’s image and abilities to be responsive to the community and marketplace within which it conducts its business.

Organizational Structures

There are many different types of health care organizations that function in the marketplace. They can be grouped into three broad categories: payers, providers, and hybrid organizations.

Payers

Payers are organizations that provide the financing for health care services payments and reimbursements. Commercial payers are commonly private insurance companies. Public or government payers are local, state, and federal agencies such as the Federal Government’s Centers for Medicare and Medicaid (CMS) agency.

Public Payers

Collectively, numerous government health care programs and the CMS provide public health care coverage and reimbursement. In general, public payment of medical services to older, generally retired individuals is covered by Medicare. The poor or disadvantaged are covered by Medicaid. Jointly, federal and state governments have developed a system that reimburses hospitals, physicians, and other health care providers for the services they provide to Medicare and Medicaid recipients.

Commercial Payers

Commercial payers (insurers) are those organizations that utilize private funding to reimburse defined-covered services (insurance policies). They reimburse hospitals, physicians, and other care givers for the services they provide to individuals who have purchased an insurance policy.

Providers

Providers are in the business of delivering health care services. There are many different groups of providers including physician organizations, hospital organizations, physician–hospital organizations (PHO), and integrated delivery systems (IDS).

Physician Organizations

A physician organization can be a single practicing physician, a partnership among two or more physicians, or a group practice of a larger number of physicians. Physician organizations primarily deliver the services of a medical doctor to individuals. They may or may not provide additional support services such as radiology (X-rays) and laboratory tests. The management structure of such organizations is typically very straightforward: The physician (or physicians) decides what services to offer, how best to offer them, and what the charge will be for any given service. Public and private payers, however, govern payment or reimbursement of their services.

Hospital Organizations

Hospitals’ primary services are to provide all the other medical support services that physicians require but are unable to provide themselves. These support services include a physical location in which to provide complex care, a place where surgery can be performed under controlled conditions, and access to costly diagnostic services and equipment. Public and private payers also govern the payment or reimbursement of the services provided to hospital organizations and other provider types.

Physician-Hospital Organization

“A PHO is a joint venture between one or more hospitals and a group of physicians. It acts as the single agent for managed care contracting, presenting a united front to payers. In some cases, the PHO provides administrative services, credentials physicians, and monitors utilization” (Burns, 1995).

Integrated Delivery Network or System

An IDN is a system of health care delivery that may include other health care services in addition to hospital and physician services. An IDN may be a closely or loosely tied network of hospitals, physicians, ancillary and diagnostic providers, and other health care institutions, such as skilled nursing facilities (SNFs). The delivery of care is coordinated among the various provider types to provide or arrange to provide health care and related services within a contained network or system of care.

Hybrid Organizations

A hybrid organization is a company made up of both health care providers (hospitals, physicians, etc.) and payers (public or private payers). A hybrid organization in the public sector may be a state-owned and operated hospital, providing care to patients who are covered by government sponsored insurance.

Healthcare Financing

Health care financing in the United States has drawn considerable attention in the era of health reform. In this article, the focus is directed to the issues of cost by examining the effect financial changes are having on the organizational structure of the U.S. health care system.

Financing Health Care

The system for financing health services in the United States reflects the fragmentation of health care as a whole. The growth of employer-based private health insurance stimulated unprecedented growth in health expenditures and biomedical advancement for the United States in the post-World War era. The advent of Medicare and Medicaid in 1966 heralded a period of even more rapid growth, along with unbridled inflation, that persists to this day.

Inequities in access to health care, thought to be alleviated by Medicare and Medicaid, and the extensive provision of voluntary health insurance for employed groups, have not been resolved. Universal health coverage has not been realized, and a substantial and growing percent of the U.S. population go uninsured. The truth is that the different methods of financing health care in the United States continue to place different burdens on the various income levels of society. A central purpose of the health care system is to maintain and improve the health of the nation’s population. Burdening low-income families with high levels of payments for health care amplifies the ill effects of poverty and continues to increase the health care access differentials along socioeconomic lines.

Restructuring the System: Managed Care

Perhaps the most significant change in health care financing of late is the increasing presence of managed care. The bundling of medical services into one capitation payment has advantages over fee-for-service plans, but the implementation of capitation by insurers and providers has created enormous tensions within the health care community.

Capitation is neither new nor uniquely American. It has been the principal mode of payment for the past 50 years in Britain. What makes it unique in the United States is the degree to which it has fragmented into multiple forms which combine capitation with fee-for-service features. In fact, new forms are still emerging with the United States health care structure. Recognizing that the evolution of managed care to this point has not yielded an ideal health care system reinforces the need to further assess which managed care mechanisms are effective in improving access, cost and payment, and patient and provider satisfaction.

Private Health Insurance and Employee Benefits

Private health insurance is the most prevalent source of financing for the U.S. health care system after Medicare. Few other industrialized countries maintain systems of private medication insurance programs that even approximate those established in the United States.

Private insurance was and is popular, because it reduces the risk of bankruptcy for both patients and health providers. Additionally, it promotes growth and money for new technology. In short, it is the means for medical care to grow.

Private health insurance, however, has not served all sectors of American society. The large proportion of the uninsured who are members of working families—84%—underscores the less than universal nature of employment based health insurance. Private health insurance dramatically reduced disparities in the use of health services related to income for the population with coverage, but it remained for Medicaid and Medicare to significantly improve access for the elderly and the poor.

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