Effective communication is key to success.
The ways that hospitals make capital investments are changing. Once upon a time, most hospital capital went toward “brick and mortar” projects. Hospitals expanded facilities, added beds, and bought new equipment. But times have changed. According to the 25 provider organizations that shared their strategies at HFMA’s recent Capital Conference, a greater proportion of capital today is spent on IT installations and upgrades and on physician integration. But because these investments result in benefits that are not always physically tangible, providers must take extra steps to determine and then communicate the value those investments bring.
For example, it can be difficult for hospitals to demonstrate the ROI of having an integrated electronic health record (EHR), especially in a fee-for-service environment. Yet as we move toward value-based payment, EHRs are critical to managing patients across the continuum of care, achieving high-quality outcomes, and using resources appropriately. In fact, HFMA is currently working with the Institute of Medicine to create a standard template for calculating ROI on an EHR investment.
Showing ROI on physician integration also is a challenge. Today, most hospitals are losing money on physician integration on a direct basis. However, in a value-based marketplace, physician integration is an absolutely necessary step for many hospitals to achieve scale, manage quality, and control costs. Making things even more challenging is the fact that in the short term such investments could weaken an organization’s financial ratios, threatening its credit rating and potentially raising the cost of capital. So what is a hospital to do? The answer is: communicate, communicate, communicate.
First, communicate with your staff—not just with higher-level management. Everyone who works at your institution should know why you are making these particular capital investments—how they fit into your organization’s long-term strategies. When your coworkers understand why these steps will create a position of strength, they will be as committed as you are to making them a success.
Next, help your creditors and rating agencies understand that you are investing for the future. Share your knowledge of what the coming marketplace will look like under reform and how these necessary investments will position you for success. Encourage them to look beyond the latest numbers and to see how these investments position the organization for improved financial health. At HFMA’s Capital Conference, rating agency representatives stressed the importance of communication.
Finally, let the entire community know what you are doing and why. Reaching out directly to the people in your community can help them understand that—even if they don’t see new construction going up—your institution is working to provide the best service possible in the years to come. You are demonstrating a commitment to the community you serve. And be specific! Let them know how additional physician practices and IT investments improve the quality and experience of care.
Investing in your organization is always the right move. In this environment, however, the payoff may be several years away. Effective communication will ensure that your key stakeholders share your vision for the future and support the steps you take to get there.
Publication Date: Wednesday, May 01, 2013