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Changes In The Healthcare Industry Have Impacted The Hospital Governing Board Structure

Hospital Governing Board Structure

After the implementation of ACA, more hospitals and health systems entered into affiliations, acquisitions, membership substitutions, joint ventures, and clinical affiliations. These changes have caused the need to restructure systems. New systems include mega-systems, regional systems, multi-state systems, single state systems, and local systems.

In addition, healthcare systems are shifting from being acute care-centered to being patient-centered. In the quest to shift to outpatient and in-home care, boards are also being challenged on how to maintain safety and quality care, while managing associated risks. These shifts have necessitated major changes to the hospital governing board structure as we’ve known it in the past.

The board organization and structure need to complement the organizational structure. Today’s boards and managers are struggling to keep up with the changes and adjust their governing board structures to meet the needs of their organizations. In the interest of dealing with the most immediate challenges, some boards are continuing to hold onto traditional structures, which are not the most appropriate or efficient.

Board management software solutions are the answer to dealing with the complexities of healthcare systems and the need to be adaptable.

Operating Structure Affects Board Structure

The governance structures of hospital systems must align with organizational operations. This is important to address the organization’s goals, particularly the short-term goals. Healthcare systems also need to be flexible and dynamic enough to adapt to the current and future changes that are bound to occur.

New systems and new approaches to healthcare mean that hospital boards will need to find new sources of revenue, form new strategic partnerships, and possibly add new leadership positions. Some of the new titles may include Chief Quality Officer, Chief Innovation Officer, Chief Experience Officer, Population Health Officer, Chief Governance Officer, and possibly others. These new positions mean that boards will begin getting new reports that they’re not yet familiar with.

The changes in the organizational leadership may prompt changes in the composition and structure of boards. No matter how the systems and structures shake out, boards need to ensure they’re competent enough to effectively govern despite changes and challenges. New systems and structures will require boards to have a different level of detail and different metrics. For example, boards will need to begin placing a greater emphasis on health and wellness then they’ve done in the past. This will require them to provide outreach opportunities within their communities. The board’s organization and structure should help these changes in the healthcare industry rather than hinder them.

Governance Changes May Prompt Changes in Board Size

The vast amount of changes in the healthcare industry may prompt boards to right-size their boards. Boards that are too small may not have the necessary skills and abilities to carry out their responsibilities well. Boards that are too small may also find that they don’t have enough people to fill out their committees appropriately.

Overly large boards may find that they’re getting bogged down in boardroom discussions. Too many opinions will make it harder to come to a consensus on important matters. Another problem with large boards is that they end up making many of the decisions through the executive committee without the full input from the board. According to The Governance Institute, the average number of board members for a healthcare institution is 13 and large system boards average about 17 members.

The Role, Responsibilities, and Accountabilities for Hospital Boards

Hospital boards need to have a clear understanding of their new roles, responsibilities, and accountabilities in light of all the changes. This means that it’s prime time for boards to review their board member job descriptions and update them to reflect the organization’s structure and strategic vision.

Healthcare systems that have multiple boards will have to determine the role that each board plays within the collective system, what each board is responsible for, and how they will report up to the parent board. There is no single structure that’s appropriate for all systems. In setting up leadership, boards will need to account for the size of each system, the geographical location and spread, the level of diversity in patient populations, and the culture across systems.

The parent board will also need to determine how they’ll hold each of the smaller boards accountable. Once these decisions have been hammered out, the boards will need to establish clear job descriptions for each board. Corporate parent boards will need to have control and authority over their affiliates so they can effectively manage competition, system brands, system-wide strategic initiatives, asset investments, and work to eliminate waste and duplicity.

The main challenges with large healthcare systems are having too many board and committee meetings and too many board members to track which could complicate things further. Too many people can hinder innovation and slow down change. Too many people on too many boards mean that it will take too much time to prepare adequately for meetings and establish standards and protocols across boards. Smaller boards may want to retain control and focus on their own communities and hospitals so they can continue to make decisions for the good of the stakeholders without worrying about whether they will be at odds with system goals.

For systems that have only one parent board, the job description should include how the board deals with accountabilities for operating performance and strategic oversight for the whole system.

A BoardEffect board portal system is the perfect board management software system for large, multi-system healthcare organizations and smaller, single-board systems. The board portal provides a secure digital platform where boards can collaborate and communicate about the hospital governing board structure and manage their board and committee meetings efficiently.

Healthcare institutions have many questions before them about the nature of their organizational structure. The answers may be to retain boards, limit them, or eliminate some of them altogether. Large systems have the benefit of local boards that can provide a built-in constituency to support larger systems. Overall, the governing board’s structure needs to allow for enough time and flexibility to devote to strategic issues to move forward with the organization’s stated vision.

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