From the Executive Perspective:
The CEO of North Eastern Hospital (NEH), Jim James, had been playing the waiting game, assuming that he had plenty of time to prepare for how his institution would be impacted by the Affordable Care Act (ACA). When the Supreme Court upheld the constitutionality of President Obama’s signature legislation in June 2012, Jim realized he and his staff needed to quickly rethink the hospital’s position and shift strategies. While they had initially seen the health care reform provisions of the ACA as burdensome, now he wanted the staff to think about the opportunities that it offered and how it could enhance NEH and help it to fulfill its mission in serving the community.
The more Jim read and thought about the provisions of the new law, the more convinced he became of the benefits. Since the primary goal of the ACA was to bring the uninsured into coverage, large number of uninsured individuals in the community would soon have access to care. And, with insurance companies being required to provide coverage for those with preexisting conditions, these folks would have access.
There were many negative stereotypes associated with both groups. While some of these people were indeed very ill, it was also clear that the fact that people didn’t have insurance did not necessarily mean they were sick. In reality, many were healthy individuals who, for whatever reason, were uninsured. Some were seasonal workers in organizations that didn’t provide coverage to their employees, others opted not to buy coverage, and there were those who just could not afford it and would now be subsidized. Additionally, some with preexisting conditions had in the past been denied insurance coverage on the basis of relatively minor problems such as sinusitis, a prior knee injury, and removal of a small benign tumor and so on.
This looked to Jim like bonanza. Jim wanted to find ways to connect these groups to his hospital, as well as its associated outpatient clinics and excellent pool of physicians and other health care professionals. This led him to thinking about new programs, modifying existing programs, developing marketing strategies, finding ways to capitalize on the pent-up demand for services in the short run, and becoming the provider of choice in the long run.
(1) What should NEH do? Would you recommend developing new programs? Or, should existing programs be expanded to meet the increased demand? Provide the rationale for what you choose.
(2) Are there areas of the hospital where demand might be reduced? For example, many of the uninsured may have used the ER as their point of access to care in the past. What would you propose to change this behavior and to address issues relating to the ER?
(3) What marketing strategies might be developed to attract this new clientele?
(4) What decision model(s) would be ideal for application in this case? State your justification. State if additional information was necessary for you to arrive at a better decision(s) in your case.
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