Partners HealthCare System Inc. (B): Cardiac Care Improvement Case Solution & Answer

Case Summary

            This case examines the key issues threatening the CEO at the Brigham and Women’s Hospital in an effort for changing the health care environment. As pressures have increased for controlling the cost in the health care industry, therefore, the organization has gone through a series of reengineering efforts to reduce costs while providing the high-quality health care services. The CEO of the organization is assessing the outcomes of this hard work and considering different strategies for improvement.

Q1. PCHI Network Strategy

Collaborative Approach

            In the year 1993, the Boston Massachusetts Brigham and Women Hospital (BWH) formed an Alliance with its competitor Massachusetts General Hospital (MGH) by using a collaborative approach. They formed a new organization namely Partners Healthcare System Inc. (PHS) to develop a more advanced, integrated, coordinated healthcare network to provide high-quality services to the patients and compete in the healthcare industry.

            Both the organizations were well known in the healthcare industry. Both the organizations had more than 18000 employees together including 4000 doctors and 2500 nurses. Moreover, they also had more than 75000 admissions with an expenditure of $1.2 billion annually. Therefore, it enabled the alliance to achieve competitive advantage effectively by using the resources of both the organizations in terms of cost, time, human, etc.

            Furthermore, the network of Partners also formed a non-profit organization namely Partner Community Healthcare Inc. (PCHI) to monitor the development and performance of the network in order to meet the objectives of the alliance in a systematic way. The organization members of PCHI consisted of the representatives of Partner Healthcare System, BWH, and MGH. The main objective of PCHI was to form a centralized management system for the network in order to use their resources effectively and achieve the goal of the alliance.

            The strategy of PCHI was to offer a broad portfolio of services like home care, mental health, rehabilitation, etc. Communication and coordination play a very important role in achieving the targets of the organization. Therefore, an integrated network was formed which comprised of physicians called primary care physicians (PCP) and specialists. They were responsible for handling the central management system of the organization.

            PCHI also used an advanced approach by building its network either by the acquisition of or affiliation with the physician groups. With the acquisition approach, the organization directly employed the physicians and paid their salaries or signed a contract with a group of physicians to provide them a fixed budget. With the affiliation approach, the organization signed contracts with the physicians to send their patients to the PCHI’s network. These approaches enabled the organization to provide 24/7 healthcare services to the patients with the help of expert doctors and physicians.

Operational Approach

            The purpose of forming Partners Healthcare System was to provide high-quality healthcare services to the patients and achieve competitive advantage. Therefore, PCHI also formed operational strategies in order to deliver the services more effectively and efficiently. There were four phases of the flow of patients; enrollment, wellness, illness and acute illness. In the enrollment phase, the patient was first enrolled in the integrated system of PCHI by assigning a unique id.

            The complete medical history of the patients was also added in this phase. In the wellness phase, a complete care plan was designed for the patients based on their medical history. In the illness phase, the patient was then referred to the physician or specialist within the network. In the last phase, the patient was either dischargedor sent back to physician or specialist.  This strategy provided strength to the organization to provide the treatment to the patients in a systematic way.

Negotiation Approach

            PCHI also used different negotiation strategies in order to sign a contract with HMOs and insurance companies. By the end of 1995, PCHI had successfully signed two contracts; one with the Tufts Secure Horizons so that they would refer their patients to PCHI’s network and second with Blue Care 65 for the insurance of Medicare patients. It enabled the organization to achieve the competitive advantage over its competitors…………………….

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