KU Critical Access Hospital &


Carol King is vice president of human resources at a 127-bed facility located in a small farming town. She has been at Robbins Memorial Hospital for only 2 weeks, but has already concluded that the human resources department is not well developed and there are no policies for many situations.

King was informed by the director of the intensive care unit that a female night employee has told other staff that when she comes to work she carries a small loaded gun for personal protection. The gun has been shown to other employees and allegedly waved carelessly about in the unit. King responded by stating that the facility has a clear policy that prohibits employees from bringing firearms onto the premises. The director of security, however, reminded King that recently a night shift employee was assaulted in the parking lot and that many female employees are concerned for their safety. The director of security is worried that there might be other ramifications if this employee is disciplined. For example, other night shift employees might say that the facility is not concerned about their safety and that carrying a firearm is both a second amendment (constitutional) guarantee and necessary because of poor facility security. King agreed that this might become an issue and was also concerned that the facility has had difficulty getting nurses for the night shift.

Question: What should King do? Why?



The president signed a bill passed by Congress establishing universal-comprehensive .health insurance. It will cover all residents for medically necessary hospital inpatient and outpatient services, physician and other licensed independent practitioner services, and nursing facility care. The National Health Insurance (NHI) program becomes effective 12 months from yesterday. Funding for the NHI program will be through a national value-added tax. All residents, whether employed or unemployed, are covered by the NHI program from birth to death and there are no beneficiary deductibles or co-payments. State government State Health Insurance Boards (SHIBs) will be the fiscal intermediaries. Private health insurance for covered services will be barred when the NIH program takes effect.

Delivery of services will be private, as before, and will be done through existing providers (e.g. , hospitals, nursing facilities, private practitioners). Institutional providers’ services and capacities will be frozen in place the day the NHI program begins. They may only be changed (added to or deleted) subject to SHIB approval based on the SHIB’s assessment of area needs. Start-up and facility expenditures for approved expansions in services and capabilities will be fully funded by the federal NHI Board through the SHIB .

Amounts paid to all independent providers such as physicians for care rendered to beneficiaries will be fee-for-service. National rates for all services will be determined by the federal NHI Board and will vary in amount only by geographic area based on a market-basket consumer price index. Institutional providers will not be reimbursed on fee-for-service, but will receive annual global budgets that are fixed. These budgets will be determined by each SHIB and will be largely based on capacity, such as type and number of beds. Providers will not be allowed to extra bill patients. Since uninhibited access is an objective of the NHI program, all providers will be required to service customers who present themselves.


I. Is the NHI program a threat or an opportunity for providers? Why?

2. If you were a hospital chief executive officer, what organization strategies would you recommend for implementation before the start of the NHI program? What strategies after it begins?

3. Once NIH becomes effective, what changes in stakeholder relations would you predict?



The Puget Sound Cooperative in Seattle, Washington, one of the oldest and most respected HMOs, wanted to increase enrollment of young, low-risk subscribers. It was only logical when the newly recruited marketing staff chose the local hard rock music station as their medium and shaped the message accordingly.

“Hey, are you TIRED OF SICK CARE? How about joining THE HEALTH CARE plan?” rasped the announcer.

Within hours after the spot was first aired, an eruption equivalent to that of Mount St. Helen’s began in the Seattle medical community. The local medical society was enraged by the implication that doctors not in the HMO made people sick. The cooperative’s medical staff was enraged by the degradation of having their services offered on a hard rock station (one wonders why so many of them were listening to it). There was concern that the spots would upset the cooperative’s efforts to recruit private physicians in outlying communities into a partnership with it and thus seriously hamper efforts to open these new markets. The spot never surfaced again.


I. Who were Group Health’s stakeholders in this situation?

2. What message was being transmitted to these stakeholders?

3. How should senior management try to communicate with young, low-risk potential subscribers?



Carol King is vice president of human resources at a 127-bed facility located in a small farming town. She has been at Robbins Memorial Hospital for only 2 weeks, but has already concluded that the human resources department is not well developed and there are no policies for many situations.

The following situation was described to King by the food service manager:

A cook at Robbins Memorial Hospital was observed taking a chicken and other food from a storage area and putting the items in a bag under his coat. As the employee entered his car to go home he was stopped by security officers and told that they were making a package check of the contents of the bag he was carrying. The employee objected, but the security officers insisted, stating that there was a policy allowing inspection of all packages removed from the facility. The employee relented and the food items were found in the bag .

The employee was terminated by the food service manager for theft. He filed a complaint with the Equal Employment Opportunity Commission (EEOC) alleging that his dismissal resulted from discrimination based on the fact that he is the only food service employee who is an ethnic Italian and that other employees regularly take food from the department. Therefore, his termination was based solely on the fact that he is Italian and he was “singled out.” King and the security director have no knowledge that other employees are stealing.

Question: -What position should the facility take when contacted by EEOC?


Discussion 4) What is a Critical Access Hospital? How are these hospitals reimbursed?

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