Rural Hospitals Struggle Under Private Equity Ownership

Original article on Electronic Health Reporter

By David L. Schreiner, Ph.D., FACHE

Private equity ownership of rural hospitals is growing, but so are concerns about the effects private equity firms can have on quality of care in small, community hospitals.

A new study reveals that care is riskier for patients at hospitals that are owned by private equity firms. Patients are more likely to fall, get new infections, or experience other forms of harm during their stay at a hospital acquired by a private equity firm. Researchers in the aforementioned study found the findings were alarming because they indicated an inference that financial incentives were deemed more important than patient care. There are at least 130 rural hospitals under the ownership of private equity.

Financial factors

Private equity ownership prioritizes short-term financial returns over long-term community needs. This can threaten services like obstetrics that lose money but are important to access.

When private equity-owned imaging centers and ambulatory surgery centers open near rural hospitals, it creates financial challenges. Private equity may restrict the number of Medicaid patients they accept, taking those patients with commercial insurance away from rural hospitals that accept all patients regardless of insurance status or ability to pay. This is problematic for rural hospitals, as Medicaid patients make up around 30% of their patient population. Examples include outpatient imaging centers and ambulatory surgery centers.

Studies have also found that patients experience worse clinical outcomes at hospitals owned by private equity. This could be due to reduced staffing levels that occur under private equity ownership. Private equity firms are known to cut costs through measures like decreasing nurse-to-patient ratios. For rural hospitals, which already operate on thin margins, competition for talented staff can be challenging.

The value of local relationships

Healthcare, like politics, is local. While many hospitals offer similar services, these offerings are tailored to the local population they serve based on various factors, including religion, culture, key employers and, yes, even weather. And the smaller the hospital and its service area (imagine a map of a rural hospital’s primary service area), the more tailored services are for the population they serve.

The rural hospital where I work, Katherine Shaw Bethea Hospital in Dixon, Ill., prioritizes keeping physicians and providers local. Having doctors and nurses who live in the community allows for personalized care tailored to each patient’s individual needs. This level of personal attention may be lost at larger hospitals with absentee ownership.

Rural patients value the relationships and familiarity they have with providers who are their neighbors. In rural areas, we know our patients on a more personal level. Team members in our clinics often know that Mrs. Smith is a talker and needs a 20-minute appointment, while Mrs. Jones wants to be in and out as quickly as possible. This knowledge might also have a clinical impact when providers see behaviors atypical for that individual.

Independent rural hospitals as economic drivers

Local ownership is often the largest economic driver in the community. Rural hospitals provide jobs and support local businesses, leading to improved living conditions for many in the region.

While private equity can provide needed capital for facility upgrades, I’m concerned about rural hospital independence being threatened. Two U.S. senators have launched investigations finding private equity ownership leads to workforce cuts and reduced quality. Ensuring transparency and accountability is also more difficult with private firms not required to meet the same disclosure standards as non-profit hospitals.

For the future of rural healthcare, fundamental reforms are needed to support small, independent community hospitals financially. I hope policymakers will address how to best care for the “tweener” rural hospitals left out of many conversations. Without changes, more hospitals may be forced to turn to private equity, and the impacts on local access to care could be significant.

The leader of Katherine Shaw Bethea Hospital shares how some implemented ideas have fared.

Orginally posted by HealthLeaders

BY Jay Asser, January 30, 2024

Many rural hospital CEOs are searching for answers in their mission to keep the doors open in the face of financial turmoil.

For David Schreiner, CEO of Katherine Shaw Bethea Hospital, not every strategy his facility has applied has been a home run, but the ideas that didn’t pan out served as lessons learned.

Understanding what has and hasn’t worked has allowed the Dixon, Illinois-based hospital to remain independent and stave off some of the crippling perils that have plagued so many rural operators across the country.

Watch Schreiner describe what’s been successful and not-so-successful during his time at the helm in the video below.

Jay Asser is the contributing editor for strategy at HealthLeaders. 

WHY ONE RURAL HOSPITAL CEO ADVOCATES FOR LOCAL OWNERSHIP OVER PRIVATE EQUITY

Original post on HealthLeaders

By Jay Asser, January 26,2024

When it comes to patient care, the choice is clear, says David Schreiner.


KEY TAKEAWAYS

In the United States, at least 386 hospitals have been acquired by private equity firms, with 34% of all private equity-owned hospitals serving rural areas, according to the Private Equity Stakeholder Project.

A study published in JAMA uncovered that private equity-owned hospitals was associated with increased hospital-acquired adverse events despite having patients that were at lower risk.

Quality of patient care is a major reason why David Schreiner, CEO of Katherine Shaw Bethea Hospital in Dixon, Illinois, is a proponent of staving off private equity ownership in rural communities.

Private equity’s influence in healthcare has grown over time for a reason, but the question of how much it’s helping some of hospitals’ biggest problems remains up for debate.

As more rural hospitals collapse under the weight of financial struggles, private equity firms are stepping in with the aim of turning around these floundering facilities. While investment in rural healthcare is much needed, David Schreiner, CEO of Katherine Shaw Bethea Hospital in Dixon, Illinois, believes locally owned hospitals have the advantage over private equity in the type and quality of care they provide patients.

“The thing that I look at when we look at private equity is the decisions that are made that impact patient care and impact staff,” Schreiner told HealthLeaders. “It’s the financial prioritization versus community health needs.”

A recent study published in JAMA examined that dynamic by investigating how quality of care and patient outcomes change after private equity acquisition of hospitals. Researchers used Medicare claims for more than 4 million hospitalizations between 2009 and 2019 to compare hospital stays at 51 private equity-acquired hospitals against those at 249 non-acquired hospitals.

The findings revealed that private equity acquisition was associated with a 25.4% increase in hospital-acquired conditions, driven by falls and central line-associated bloodstream infections. These results were observed despite the private equity hospitals having a likely lower-risk pool of admitted Medicare beneficiaries, implying worse quality of inpatient care.

According to the Private Equity Stakeholder Project, at least 386 hospitals in the country are owned by private equity firms, which represents 9% of all private hospitals. More than a third (34%) of all private equity-owned hospitals serve rural populations and there’s little reason to believe that won’t continue to grow.

While Schreiner acknowledges the financial hardships rural healthcare is facing, he feels locally-owned hospitals can operate differently when they’re not bound by maximizing profits at every turn.

“We’re an independent rural hospital. We have no ownership, no one is receiving dividends or investment returns from our organization,” he said. “So we’re motivated to meet the needs of the community and we often perform services and have service lines that are intentionally not profitable.”

Schreiner pointed to obstetrical services being abandoned by many rural facilities due to lack of available personnel or diminishing financial returns. Yet there are still those rural hospitals that provide it, even at little to no financial gain.

“PE firms are going to make those decisions very quickly because that’s what they do and that presents a more positive bottom line,” Schreiner said. “Many community hospitals are willing to have a lower compromised bottom line and continue providing services.”

So long as the “financial prioritization” outweighs everything else, patient care will be at risk in rural settings where private equity strengthens its grip.

Jay Asser is the contributing editor for strategy at HealthLeaders. 

Assessing the impact of private equity ownership on rural hospitals

Originally published on DOTmed HealthCare Business News

by Gus Iversen, Editor in Chief, January 25, 2024

For better or worse, private equity investment is playing an increasingly central role in healthcare. Dr. David L. Schreiner president of Katherine Shaw Bethea Hospital in Dixon, IL, and author of Be the Best Part of Their Day: Supercharging Communication with Values-Driven Leadership, has had a front row seat to observe how private equity is impacting rural providers.

Having spent most of his life in small towns and working in small communities, Schreiner is a passionate advocate for rural hospitals. He sat down with HealthCare Business News to talk through some of the ways private equity investment is shaping care.

HCB News:Private equity investment is a huge trend in healthcare. How have your own experiences in healthcare been shaped by private equity?
Dr. David Schreiner: Our area has not had the introduction of private equity in acute-care hospitals. However, an outpatient imaging center has been added to our service area within the last year. This center disproportionately accepts paying patients, leaving Medicaid patients to area hospitals.

HCB News: What are some of the overlooked risks associated with private equity investment for healthcare providers?
DS: PE firms may be focused on short-term financial returns that could be misaligned with the health needs of the region. At KSB Hospital, we work through three-year strategic plans that evaluate the needs of the population we serve and adjust our business plans accordingly. If PE firms aggressively seek high margins for their investors, this could come through decreased staffing levels, resulting in additional adverse hospital events, such as those described in the article. If PE ownership results in the closing of service lines (like obstetrics or inpatient behavioral health) or even the merger of facilities, this logically increases travel times for patients and extends the time to seek crucial services. Think of the “golden hour” from the onset of a cardiac event or stroke. If patients have to travel further, crucial minutes are lost.

A focus by PE firms on efficiency and cost-cutting may lead to staff reductions and increased workloads for those team members left behind, potentially affecting the quality of care. Loss of talent in our organizations during the current war for talent is disruptive to patient care and might lead to a downward spiral in a facility’s ability to offer a wide-range of services.

HCB News: Advocates for private equity investment often point to the financial boost it can provide. Would you agree the financial backing can be a life saver for a facility on the verge of shutting down?
DS: Many rural hospitals, and ours is no exception, are struggling to maintain daily cash, and this limits our ability to recapitalize. We have gone from investing $7M annually on capital projects to a break-fix mentality. PE can provide an infusion of much-needed capital into our organizations.

HCB News: From a big picture, do we know *why* private equity investors are so drawn to healthcare?
DS: Rural populations represent a target demographic for PE firms. While trending older, these patients are loyal to their hospitals and doctors. The ability to cross-sell other products is enticing. PE firms may feel as if their proven business practices can “correct” the sins independent hospitals have made. With the renewed efficiency, a financially struggling rural hospital might prove to be a good PE play.

HCB News: For hospitals struggling financially, what are alternatives to private equity that may boost their viability?
DS: Partnerships with other NFPs and even geographically near competitors might be an alternative to PE investment and control for rural hospitals. Anything rural hospitals can do to spread costs among a greater service area, such as partnerships with home care providers, wound care centers, and urgent care clinics, might increase the financial viability of rural hospitals.

HCB News: Are there any other important aspects to private equity in healthcare we haven’t discussed?
DS: The economic ripple effects of a community losing its rural hospital or undergoing a change of ownership can be extreme. Rural hospitals are often the largest employer in their community, and when hospitals close or downsize, including losing jobs, the economic downturn for the entire community is significant. A prime example of a community losing its hospital and the subsequent impact on the area can be seen in Fr. Scott, Kansas.

The current reimbursement model for independent “tweener” hospitals, defined as those systems bigger than critical access hospitals and smaller than academic medical centers, is unsustainable. Federal and State elected officials need to reinvent how health care is paid for in smaller, remote communities.

The Impact of Private Equity Firms on Rural Hospitals: A Call for Reform

Originally published on Medriva

By Mason Walker

Recent studies have sparked discussions around the role of private equity firms in the acquisition of hospitals and the subsequent impact on patient outcomes. These findings have particularly underscored the potential threat to the independence of rural hospitals and their ability to provide meaningful patient care. The president and CEO of Katherine Shaw Bethea Hospital, Dr. David Schreiner, has expressed significant concerns about the situation, emphasizing the need for fundamental reform in supporting these rural hospitals.

Private Equity Acquisition and Adverse Patient Outcomes

Several news articles and studies have been shedding light on the consequences of hospital acquisition by private equity firms. A major study found an alarming increase in serious medical complications when hospitals were bought by investors. Specifically, there was a 25 percent increase in adverse events among Medicare patients, including surgical infections, bed sores, central line infections, and falls. The same study, published in JAMA, compared the data from hundreds of thousands of hospitalizations at private equity-owned hospitals to millions of hospitalizations at non-private equity-owned control hospitals from 2009 to 2019.

Rising Concerns: Reduced Care Quality and Workforce Cuts

These findings have intensified concerns about the impact of private equity firms on healthcare delivery. The data suggests that patients receiving care at private equity-owned hospitals are more susceptible to hospital-acquired adverse events than patients at hospitals not owned by private equity firms. This has led to apprehensions about reduced care quality and potential workforce cuts. Private equity firms currently own at least 130 hospitals in the country’s rural areas.

The Debate: Access to Capital vs Personal Attention

While private equity firms do provide access to capital, a critical factor in sustaining and expanding healthcare services, there are increasing worries about the impact on personal attention and patient experience. Many believe that private equity-owned hospitals prioritize profit over provider retention and patient safety. In contrast, some argue that private equity investments improve care and expand access to it, especially in low-income, rural communities.

Steps Towards Reform

In the wake of these findings, a Senate investigation has been launched to examine the effects of private equity hospital ownership. The Biden administration has also moved to cut down on private equity’s consolidation in the healthcare industry, announcing initiatives aimed at scrutinizing acquisitions and increasing transparency. However, the conversation around the role of private equity in healthcare is far from over.

The Importance of Local Healthcare

Dr. David Schreiner has particularly emphasized the importance of local healthcare and the role of rural hospitals as economic drivers in their communities. He stresses that rural hospitals must retain their independence to continue providing meaningful care to patients. With the potential threat posed by private equity firms in the form of reduced care quality and workforce cuts, there is a clear need for fundamental reform to support rural hospitals.

The challenges faced by rural hospitals in considering acquisition by private equity companies highlight the pressing need for a balanced approach, one that ensures the sustainability and quality of healthcare services while preserving the vital role of rural hospitals in their communities.

‘The current model doesn’t work’: Illinois hospital CEO on private equity hospital acquisition

Originally published on Becker’s Hospital Review.

Written By: Madeline Ashley

As more hospitals continue to be picked up by private equity firms, recent studies have tied these acquisitions to adverse patient outcomes. 

“I’m concerned by rural hospitals that are scooped up by anyone that threatens their independence and their ability to continue to treat their patients in a meaningful way,” David Schreiner, PhD, president and CEO of Dixon, Ill.-based Katherine Shaw Bethea Hospital, told Becker’s.  

KSB is an 80-bed independent hospital with 950 employees. The hospital also has a family medicine residency program with the University of Illinois.  

“The thing that I think of is that healthcare is best provided locally,” Dr. Schreiner said. “In many times, the rural hospitals are the economic driver in the communities that we live in. I think that allows us to tailor to patients both broadly and individually. And that’s more difficult to do when you have absentee owners.”

Dr. Schreiner said that while quality of care is important, one positive aspect that comes from private equity firm hospital acquisitions is access to capital. 

“That’s something that I know for our organization and many rural hospitals since the pandemic began. We’ve had a very difficult time capitalizing and that leads to lack of new equipment and even improvement to our existing facilities. PE can help with that,” he said. 

In early December, Sen. Chuck Grassley of Iowa and Sen. Sheldon Whitehouse of Rhode Island, ranking member and chair of the Senate Budget Committee, launched an investigation together into the effects of private equity hospital ownership. The senators argue that many hospitals have experienced reduced care quality and workforce cuts under private equity ownership. 

Even though rural hospitals are under financial duress, Dr. Schreiner said personal attention is more present than in other places run by larger organizations. 

“Several of the business office functions are taken out of the community. I think that also impacts healing, because part of the entire patient experience starts when they decide to see a caregiver, and it ends with the billing process. If they don’t have the ability to call and have personal touch from someone often that lives in their community in rural hospitals, then I think that’s not as positive,” he said.

To combat rural hospitals feeling the pressure to consider being acquired by private equity companies, Dr. Schreiner said there needs to be fundamental reform.

“The current model doesn’t work. I think throughout the United States, we have to look at how we support our rural hospitals. I think many people think about rural hospitals as critical access hospitals. There are many of us that are the tweeners, so to speak. We’re larger than 25 beds and we’re smaller than academic medical centers or academic hospitals. The tweeners need to be taken care of and they often get lost in the conversation. I think private equity can make that worse.”

Giving His Best

Originally published in Dixon Living Fall 2023

David Schreiner knows a few things about leadership. He’s in charge of an operation that employs nearly 1,000 people, a place where decisions can mean the difference between life and death. He’s even earned a degree in the subject.

You could say he wrote the book on leadership.

A little more than a year after the CEO and President of KSB Hospitals earned his doctoral degree in values-driven leadership, Schreiner has written “Be the Best Part of Their Day: Supercharging Communication with Values-Driven Leadership,” a book that shares his approach to leadership and the philosophy behind it.

Published by Advantage Media (the book publishing arm of Forbes), it will be released Jan. 16, beginning with online sales on Amazon; preorders are scheduled to begin in late November. An audiobook also is planned.

What led the way to adding “author” to his list of accomplishments? The book’s title pretty much sums it up: He wants to help make people’s day — and that, he said, can be accomplished through good leadership.

“We’ve all heard stories about ‘one smile,’ or ‘one kind comment,’ or, ‘some-body held the door open for me,’ and sometimes it gives people a little bit of hope, and that’s really what this book is about. How do we do that more of ten?” he said. “If I have time to spend with my son, I want to make sure I make his day better. We can add that to the people we work with, people who you go to church with. Can you say something uplifting, as opposed to jumping in with a lot of negative communication that’s out there — we hear a lot of that. Let’s take the opposite of that and be the best part of someone’s day.”

In his book, Schreiner identifies 15 different ways to improve leadership skills through three topics. Included are stories and examples that he person-ally has seen through his work at KSB, as well as his research for his dissertation through five other hospitals and their administrations.

“The premise of the book is based on how we engage and connect personally and to do that better. How do we listen better, and how do we ask better questions?” Schreiner said. “Engaging with intent. Everything from small group and large group presentations, video, email, all of the different ways we connect that weren’t available to us awhile ago. Then being mission focused and united in leadership. In our case, the hospital has a very specific mission and that’s why we’re here, and how do we keep that mission in the front of people’s minds when we are making decisions?”

While Schreiner’s experiences often involve interacting within a professional workplace, the concepts he details in his book also can apply to everyday situations. “If I can take these 15 things and go, ‘Here are five that I’m doing well, here are five that maybe I think about once in a while, and five that I’ve never really considered’ — and can I add more to that ‘do well’ list, or maybe bring one of those things that I’m not doing and maybe do it once in a while? The goal is to engage more effectively, and if these tips help with that, then the book did what it was supposed to do.”

A native of Crawfordsville, Indiana, Schreiner’s medical career began in 1986 as a radiology technician at Golden Valley Memorial Healthcare in Clinton, Missouri, a town of nearly 9,000 people southeast of Kansas City. He joined KSB in 1989 as its director of medical imaging, supervising its radiology department, and became President and CEO in 2011, having earned a master’s degree in health services administration from the University of St. Francis in Joliet leading up to his appointment.

Schreiner also became a Fellow of the American College of Healthcare Executives during his hospital leadership, adding “FACHE” to his post-nominal collection of letters before adding a few more — Ph.D — in 2022 with a doctorate in philosophy. He added doctor to his list of accomplishments after successfully defending his dissertation through Benedictine University in Lisle, titled “What CEO Practices help Rural Hospitals engage Constituents in Volatile, Uncertain, Complex, and Ambiguous Times?”

The answer: Be engaged and connectible at a personal level from top to bottom in the workplace, and focus and invest in the community.

“CEOs of independent, rural hospitals face increasingly challenging times for their organizations and patient communities,” Schreiner wrote to open the abstract of his dissertation. “The need to engage multiple stakeholders to sustain these hospitals is paramount. This inductive study explored how rural hospital leaders seek and maintain effective engagement with patients, employees, physicians, board members and community leaders.”

Upon learning of his successful defense from his professors, he also took a piece of advice from them. Earning his doctorate has opened up opportunities for Schreiner to share his expertise, and not just locally. Fellow leaders from as far as Canada and Ireland have sought his expertise. That, in turn, led him to write his book.

“They said, ‘We think you got something, and something unique that’s not in the literature today,’” Schreiner said. “I wanted to take this to a broader audience. Not everybody wants to read 40 pages of academic articles, so I enjoyed writing the book.”

Schreiner’s determination to be a lifelong learner of all things leadership has made an impression on those he works with at KSB, including his chief of staff, Nancy Varga.

“It filters down through the executive team, and they embrace that same type of philosophy that’s in the book,” Varga said. “Certainly Dave is sharing it with our leader-ship team, and in turn, he pushes us to make sure that they share the same things with their departments. It’s cascading, and blows your mind, too. It has definitely made a difference.”

Schreiner’s dedication to improving and fine-tuning leadership skills also has made an impression on his fellow members of KSB’s board of directors. Board President David Hellmich, who’s also president of Sauk Valley Community College, was pleased to see Schreiner’s commitment to positive leadership.

“As the Chair of the KSB Board of Directors, I want to emphasize how proud I and the other directors are of Dr. Schreiner for his many accomplishments, not the least of which is his upcoming leadership book,” Hellmich said. “Dave has built a well-deserved national reputation as a thoughtful healthcare leader, and his book will help guide professionals as they navigate local challenges. It’s a wonderful bonus that Dave will denote a portion of the book’s proceeds to the KSB Hospital Foundation.”

Schreiner has also served in a leadership role on several statewide boards and task forces

focused on hospital and healthcare issues, including the Illinois Hospital Association. For 25 years, he’s also been a member of the adjunct faculty at St. Francis, teaching graduate courses on healthcare administration. In 2007, he was honored with the prestigious Citizen of the Year award by Dixon Chamber of Commerce and Main Street. Work isn’t the only place where his leadership skills come in handy — having them helps at home, too.

Schreiner and his wife, Stephanie, live in Dixon and have two children, Kaile of Dixon and Andrew of Chicago, and two granddaughters, Klara and Nova.“I think it works in a lot of different places,” Schreiner said. “I’ve found that it works in my personal life, so when I work with family and when I work with friends, some of the same concepts that come across in the book also translate into better personal interactions.”

“What I did was take my academic approach through my dissertation, and take those same concepts and add stories around it in my book,” Schreiner said. “I was looking for ways that I could engage more completely, engaging by connecting and communicating with different groups — people I report to, which are the KSB Hospital Board of Directors; our colleagues; people here at work and our KSB family; people in the community; our physicians — and taking a look at that group and finding out how to communicate better.”

What he found was a way to help people turn a page in their lives by turning a page in his own life, making the leap from academic to author and putting his approach to leadership into a book that he hopes will help today’s readers become tomorrow’s leaders.

Lessons from Children: Leading with Empowering, Authentic Love.

Originally Published in Healthcare Executive NOV/DEC 2023

Written by: David L. Schreiner, PhD, FACHE, president/CEO of Katherine Shaw Bethea Hospital, Dixon, Ill. and Melanie M. Miller, Exceptional Student Education teacher

As we gain experience and become wiser with age, it’s important to reflect on the lessons we’ve learned and pass them on to the next generation. Grandparents and leaders share common goals for our grandchildren and employees: happiness, independence and productivity. The lessons we learn from children can help us lead more effectively, and we can pass these lessons on to others.

Too often, leaders overlook the power of appreciation and fail to ask the right questions. What if we used the same approach we use with children and applied it to our staff to encourage growth and development? Following are some leadership lessons to consider from that lens.

Ask Meaningful Questions

If you want to create a positive work environment, it’s essential to make sure your staff feels heard and appreciated. One way to do this is by asking them the right questions and listening intently to the responses.

When kids come home from school, we often ask them, “How was school?” When the standard answer is “nothing,” perhaps a better ques-tion is, “Can you tell me three things that made school fun today?” Research shows that we remember things in threes, and many indus-tries abide by this “rule of three” in their business and marketing prac-tices. But the real power of this question is that it gets kids talking and sharing. They don’t realize they’re communicating meaning-fully because they’re having fun with an appreciative audience.

This approach can also work with staff. Instead of asking, “What hap-pened at work today?” try saying, “Tell me three things that happened today that made you proud to work here.” For example, you could ask them to share three things they accomplished that day or three things they learned. This gets them talking and helps them focus on the positive aspects of their day. When people feel appreciated, they’re more likely to be engaged and motivated at work.

Let Them Finish Their Thought

Time constraints and impatience lead to one of the biggest things leaders should avoid doing: inter-rupting their staff. Children with slower processing speeds need more time to speak their thoughts, and some of these children become adults with slower processing speeds. Interrupting someone sends the message that you are uninterested in what they have to say. This can be demotivating.

Instead, always let your staff members finish their thoughts. This demonstrates that you value their input and are willing to listen. If the conversation turns negative, flip it back to thinking from a place of abundance. For example, instead of dwelling on what went wrong, ask them what could have happened to make it better.

Focusing on solutions rather than problems creates a positive environment that encourages creativity, innovation and efficiency. People are more likely to take risks and try new things when they feel supported and appreciated.

Build Trust

Trust is an essential component of any positive work environment. If you want to build trust with your staff, you need to make sure they feel safe and valued. One way to do this is to eliminate criticism from your rounding practice.

Instead of focusing on what people are doing wrong, focus on what they’re doing well and how they can challenge themselves. For example, consider an employee who has frequent tardiness. Rather than criticizing the staff member for their tardiness, a leader can ask what the employer can do to help the employee, such as adjusting schedules or seeking assistance from colleagues. By taking this approach, you create a positive learning environment that encourages growth and development.

Learning new things can be challenging—for kids and adults. Another way to build trust is responding to employees’ “I can’t” or “this is too hard” statements with “it’s hard because you haven’t learned it yet.” Allowing an employee the opportunity to step back to their own confident and independent performance level can establish trust. Work backward to their proficiency and then build skills from there.

Focus on the Learners

We should honor our team members as individuals. It’s important to remember that everyone learns differently. To be an effective leader, you need to understand your staff members’ learning styles and tailor your approach to meet their needs. Pay attention to the learners when observing a leader who is presenting to a team. What do the learners react to, and how do they react?

Understanding and facilitating to your staff’s learning style can create a positive learning environment that encourages growth and development. Present in a fun and interactive way. Try various mediums, such as employee forums, video, email and chat to engage employees around important issues. Remember the “rule of three.”

Leadership in Practice

Leadership is more than just telling people what to do. It’s about creating a positive environment that encourages growth and development. By asking the right questions, letting them finish their thought, building trust and focusing on the learners, you can create a culture of appreciation that will benefit everyone.

By incorporating these lessons into our leadership practices, we can help create a positive work environment where the staff feels valued, supported and motivated. These principles can help you become a more effective and compassionate leader while creating a better future for yourself and those who will follow in your footsteps.


Turnover Trouble? Hospital CEO Shares Retention Strategies

Written by Chris Westfall and originally featured in Forbes

In 2022, turnover rates for segments of the healthcare industry ranged from 19.5% at hospitals to 65% for at-home care providers to 94% at nursing homes. According to a new report from software company Oracle, this level of turnover puts a huge financial and logistical burden on healthcare providers. Turnover in hospitals can cost up to $85,000 per clinician – and this number does not factor in future revenue for lost replacements, lost productivity, and other intangibles that hit the bottom line. While COVID-19 put additional stress on the healthcare labor force, the healthcare staffing crisis existed long before the pandemic. “There is an urgent need for healthcare organizations to proactively address the root causes of turnover, develop retention strategies, and invest in creating a supportive and engaging work environment,” explains Brian White, the CRO and Co-founder of software provider, Doorspace

Healthcare jobs are notorious for long hours and erratic schedules, and many are considered “deskless” jobs, meaning workers spend much of their time on the move. In fact, it’s estimated that nurses in hospitals walk about five miles a day. Hospitals operate at the intersection of high tech and high touch, when it comes to retention. “We focus on initiatives that are proven to be effective rather than continuing to invest in solutions that look good on paper but provide little, if any, real-world impact,” White says, referencing his company’s employee relationship management (ERM) software. But tech isn’t the only tool in the box, when it comes to keeping hospitals humming.

Focusing on impact and retention is David Schreiner’s business. Schreiner, a PhD, is the CEO of Katherine Shaw Bethea (KSB) Hospital in Dixon, Illinois. With nearly 1,000 employees, Schreiner leads an 80-bed rural facility 100 miles west of Chicago. While overall industry turnover stands at approximately 18%, Schreiner says his numbers hover around 11%. How is he tackling the challenge of retention in his hospital?

“Before our conversation today,” Schreiner shares from his office, overlooking the Rock River at sunrise, “I sent out six emails: three for work anniversaries, three for birthdays. We have an integrated reminder system so that we can stay connected with our team.” From high tech to high-touch, connection is the key, Schreiner says. “We have to earn the right for people to stay here. That means connecting with employees where they are, and recognizing their journey and their milestones,” he says. Here’s how Schreiner is making sure that those connections create better patient care:

  1. Maintaining Gratitude: how well are you doing, as a leader, when it comes to expressing your appreciation? Schreiner is writing a book, published by Forbes, called Be the Best Part of Their Day. Launching in early 2024, the book identifies 15 leadership pillars (based on both his doctoral research and personal experience)According to Schreiner, it all starts with gratitude. “Leaders need to talk about [appreciation] every single time we get in front of our teams.” In healthcare, as in any business where caring and service are front and center, the key theme is the meaning of the work. That focus on individual impact is key to avoiding platitudes, when expressing gratitude. On a human level, we all see the value of appreciating others. Schreiner explains, “We have a local community college that pumps out 20 x-ray techs every year. It used to be a case that 15 of those would have to take part-time jobs until something opened up. Now they’re placed before they graduate.” It’s no secret that the current job market When employees understand that they have more options, leaders need to understand how to value the employees that choose your organization over others.
  2. Transparency: With nearly 1,000 employees, the hospital doesn’t always lend itself to personal interaction with the CEO – but Schreiner goes out of his way to create a personal touch, inside a promise delivered. “When I get to meet with employees in the first hour of their first day at KSB Hospital, I give them my cell phone number. And I say, if within six months, KSB hospital isn’t the best place you’ve ever worked, please call me and talk to me about it.” When asked how often his phone rings, he replies, “Never. But I wish it would.” More than just a folksy offer, or a bold claim of an informal employee engagement survey, Schreiner means what he says. Walking the walk – and taking the tough calls – is part of transparency. What can you do, as a leader, to let people know that you possess that most valuable and rare leadership ability: the willingness to listen? For extra credit, consider how you might personalize your answer – and show that you mean what you say.
  3. Do the Do-Able: If you improve just 1% per day, in 73 days you will double your results. Leadership, according to Schreiner, happens one step – and one conversation – at a time. “My journey started at a place where I felt like I was underdelivering. I was not engaging in the way that I wanted to with the people that matter the most.” The impulse led him to his doctoral research into advanced leadership, as a means to identify what was missing. In his journey, he recognized the importance of adding one thing at a time, instead of trying to arm wrestle the known universe. Can you relate? Does your leadership style feel like a scene from Everything, Everywhere, All at Once? Inside the frenzy of meetings and obligations, take the win for what you’re already doing right. From a place of encouragement, expand your possibilities. Schreiner calls his approach “Appreciative Inquiry” – offering a new kind of AI that doesn’t cause all of Hollywood to go on strike. “I wanna celebrate what’s already good, and from there: What are one or two or three of the things that are still outstanding that you might be willing to try?”

At its core, leadership is about humanity: connecting with people in a way that drives results. For effective leaders, those results come from appreciation, transparency and process. Leaders, and employees, have to realize that profitability and humanity must co-exist – one supports the other. When turnover can cost as much as 200% of a single workers’ salary, retention in healthcare is a profit-sucking obstacle for everyone – driving up healthcare costs, and reducing the quality of care. More than perhaps any other arena, healthcare is a people business. But hospitals are just one example among many, where people are making a difference. Maybe you’re not healing the sick or bringing babies into the world at your office, but anything of any value happens with the input of other human beings. At least, for now anyway. When you get right down to it, business exists for people, and with people, and because of (wait for it) people. In an era where the entire knowledge of the human race is just one prompt away, the information that leaders need isn’t coming from a ‘bot. We are already well-equipped to be better human beings. And in that regard, leadership is simply putting humanity into practice.

Gratuity

Imagine this.

As your health system’s CEO, you finish a meeting with a physician, stand to walk them to your office door, and present them with a handheld tablet on which they determine your compensation. The choices are 0%, 10%, 20%, and 25%. The process repeats throughout the day as you meet with your Board Chairman, a Vice President who reports to you, a housekeeping employee, and your Administrative Assistant.

As a servant leader, your organization has determined a portion of your compensation will be similar to that of a server in a restaurant. To keep the math simple, if you earn an annual salary of $100,000, your base pay will be reduced to $80,000, and you will have the opportunity to “make it up” through service to your key constituents. If you meet or exceed expectations, a generous gratuity will be granted. Leave them wanting, and no tip is given.

Non-profit leaders see themselves as stewards of the organizations who seek to grow the resources and reputation of the organizations entrusted to them (van Dierendonck et al., 2017). Servant leaders focus on the development of their followers.

Authentic leadership and servant leadership are closely aligned. Eva suggested that “servant leaders are authentic not for the sake of being authentic, but because they are driven either by a sense of higher calling or inner conviction to serve and make a positive difference for others” (Eva et al., 2019, p. 113). When considering the context of leadership in rural medicine, authentic leaders and servant leaders conform nicely to the space. Authentic leaders need and take opportunities to interact with their constituents. Servant leaders view hospital leadership as an opportunity to serve multiple constituents.

Let’s go back to that meeting with the physician. This doctor came to speak with you about her compensation. She feels she should be paid for taking call above and beyond the one-in-three medical staff bylaw requirements. You listen intently, processing the broader organizational impact of such a move. A commitment is made to consider the request and get back to her.

The handheld is offered. The physician looks you in the eyes and chooses 10%. You receive this message: “you heard me, now what are you going to do about it?”

How might this instant application of a gratuity impact your engagement? Would your decision be affected? Would the tone of your voice and your listening practices be modified in a more remarkable attempt to show interest and concern? Remember, when you return to this physician to report your decision, the handheld device will be presented for another gratuity round.

Gratuity is “something given voluntarily or beyond obligation, usually for some service” (Merriam-Webster, retrieved June 22, 2022). Leaders provide service in every interaction, and the concept of instant feedback is thought-provoking. A leader might claim they have little control over the mindset, agenda, or temperament of the people they serve, rendering the concept of tipping each encounter unfair. A server in a restaurant has no control over parking, the table where customers are assigned, the temperature of the food, or prices. Yet they are subject to the discretion of those they serve.

Why not leaders?

Peter Northouse describes servant leadership as the caring principle, with leaders as servants who focus on their followers’ needs to help these followers become more autonomous, knowledgeable, and like servants themselves (Northouse, 2018). (p. 24). Eva et al. (2019) expanded Greenleaf’s definition by including the success and prosperity of the broader community.

Some of the world’s leading corporations have adopted servant leadership practices, including Starbucks, Southwest Airlines, Ritz-Carlton, Marriott, and Intel (Eva et al., 2019). In the seminal work on servant leadership, Greenleaf (1977) stated, “Servants by definition are fully human. Servant leaders are functionally superior because they are closer to the ground—they hear things, see things, know things, and their intuitive insight is exceptional. Because of this, they are dependable and trusted.”

As servant leaders, we are motivated for reasons far beyond financial returns to care for those we serve. I interviewed CEOs, board chairpersons, hospital executives, physicians, and staff members at five health systems to determine effective engagement methods. Three themes emerged from the research.

This qualitative research determined that all three best practices for engagement must be implemented.

Engage and Connect at a Personal Level

Ask great questions and generate positivity

  • Develop outstanding listening skills and practice them regularly
  • Be accessible and show an interest in member concerns
  • Find ways to express gratitude
  • Find ways to interact through rounding

Engage with Intent through Various Mediums

  • Find a rhythm of regular communication with key constituents
  • Be transparent with high frequency
  • Use multiple channels to communicate your message
  • Look for ways to overcome engagement challenges
  • In times of crisis, be intentional in communicating differently

Be Mission-Focused

  • Keep the focus on the mission and know your audience – be prepared
  • Vocally support team members and encourage healthy debate
  • Ensure team members feel informed and included
  • Build a structure to support key leaders
  • The Executive is part of the community – get involved

If your compensation depends upon the evaluation of others defined at the moment of interaction, these best practices give you the best chance of reaching and exceeding your previous salary.

And who is to say our compensation and career success do not, directly and indirectly, revolve around how we engage with our key constituents?

References

  • Eva, N., Robin, M., Sendjaya, S., van Dierendonck, D., & Liden, R. C. (2019). Servant leadership: A systematic review and call for future research. The Leadership Quarterly, 30(1), 111–132. https://doi.org/10.1016/j.leaqua.2018.07.004
  • Gratuity Defined. (n.d.). Merriam-Webster. Retrieved June 21, 2022, from https://www.merriam-webster.com/dictionary/gratuity
  • In-text citation
  • Greenleaf, R. K. (1977). Servant leadership: A journey into the nature of legitimate power and greatness. Paulist Press.
  • Northouse, P. G. (2018). Leadership: Theory and practice (8th ed.). Sage Publications.
  • Schreiner, D. L. (2022). What CEO practices help rural hospitals engage constituents in volatile, uncertain, complex, and ambiguous times?
  • van Dierendonck, D., Sousa, M., Gunnarsdóttir, S., Bobbio, A., Hakanen, J., Pircher Verdorfer, A., Cihan Duyan, E., & Rodriguez-Carvajal, R. (2017). The cross-cultural invariance of the servant leadership survey: A comparative study across eight countries. Administrative Sciences, 7(2), 1–11. https://doi.org/10.3390/admsci7020008