Resource Library

Imagine a health care consumer who dictates his or her own health goals, tracks progress with a wearable medical device or two and who consults provider and social media contacts for advice about interventions, side effects and choices affecting his or her health that could be rewarded financially via insurance policy incentives.

Our understanding of effective governance in hospitals and health systems is growing. Several recent studies find that meeting certain benchmarks for board structure, composition, culture and evaluation practices has become a basic governance responsibility. These studies also call for heightened board engagement in governance oversight responsibilities.

With CEO support and opportunities for education, trustees can become better hospital leaders

Society and industries are always evolving; revolutionary change occurs sporadically when powerful forces align to disrupt the old order. The health care delivery system today is in the midst of an historic transformation to redesign how care is delivered. The quite immodest aim is to take 20 to 30 percent of costs out of the system while maintaining or improving clinical outcomes and patients’ health.

Although scorecards that measure health system performance against established metrics have become an increasingly common and useful tool in the trustee’s governance toolbox, finding concrete, comprehensive ways to measure how well the organization is achieving its strategic goals — and, in turn, determining incentive compensation based on goal achievement — can be a daunting, ephemeral task. Here’s how one health care system has successfully connected all the dots.

An emergency succession plan may never be used, but it’s still a necessity for every hospital. A key function of every board is to ensure that effective leadership is in place so that the institution it governs can continue to achieve its mission, vision and strategic goals.

Great Boards talked further with author Casey Nolan, managing director of Navigant’s Healthcare Provider Strategy Practice, Washington, D.C., about how boards typically function and the challenges they are likely to face at each stage of development. Nolan also discussed what board members need to know to govern effectively and add value as their systems evolve.

This monograph addresses the multiple accountabilities of nonprofit health system boards for the cost, quality, and safety of the services their facilities provide, the manner in which these accountabilities are being fulfilled, and issues we believe warrant attention by system leadership in order to retain and build public confidence, respect, and trust.

Mentoring, a process that pairs board members who are new to their roles with more seasoned board and executive resources for growth and development, traditionally has been used by health care boards to orient new trustees for board service.

This article outlines agenda items for the board’s Executive Compensation Committee. It is the first of several that will further explore many of the agenda items discussed below.

A 2012 study of Governance Practices in an Era of Health Care Transformation conducted by AHA’s Center for Healthcare Governance found that work to create greater value is where hospitals and systems in the study— and their governing boards—are spending most of their time. According to study findings, participating organizations “are concentrating on the nuts and bolts of… reducing costs and improving care quality.” The work is wide-ranging and intensive:

Given the sweeping changes in health care, forward-thinking hospitals, systems and medical centers are carefully evaluating board member succession and recruitment. The challenging environment in which these organizations operate requires strong, knowledgeable boards whose members have deep insights into the field and a fundamental understanding of business, management practices and how to compete in a highly competitive market.

Don’t overlook the importance of CEO-board etiquette — it’s a pillar of good governance. The relationship between boards and chief executive officers can be fraught with challenges, and trustees often are unsure of how to handle certain delicate situations. But using a framework of etiquette can provide guidance.

As hospitals buy physician practices, board compensation oversight must shift into high gear.

Steps CEOs and boards should take to understand and improve engagement.

Given the nature and challenges of small, elected boards, choosing to look inward and improve governance is no easy decision.

The AHA’s 2011 Governance Survey shows that good governance practices continue to take hold among hospitals and health systems. Driven by powerful economic pressures and stringent legal requirements to be visionary, strategic, diligent and independent, boards are applying various “good governance” practices, including competency-based succession planning, board orientation and education, routine executive sessions, CEO retention planning, and board self-evaluation.

Bringing new members onto the board has its challenges. In small or rural communities, the pool of potential trustees is often limited, with desirable candidates already serving on multiple boards. Even in bigger urban areas, it sometimes seems the same people rotate on and off the boards of larger community organizations — the Rotary Club, the chamber of commerce, the hospital.

As boards navigate between today’s fragmented, volume-focused health care system and a system that is more integrated and value-driven, there are plenty of issues that keep trustees up at night (see Figure 1). Are the transformational changes now confronting health care organizations affecting the way boards govern?

A reason for being. An organization’s purpose or identity. An expression of what an organization believes it must be to best meet the needs of its stakeholders. These are descriptions of what we commonly think of as “mission.” Members of a health care organization’s board are responsible for governing in ways that help fulfill their organization’s mission. But what does that really mean? How does a hospital’s mission relate to effective governance?