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The New C-suite: Sailing the Seven Cs (Part 2)

William K. Cors, MD, for HealthLeaders News, September 12, 2008

Healthcare leaders need to reinvent the C-suite and establish a new set of leadership skills to help them address the challenging nature of hospital-physician competition and collaboration. These new management core competencies or the "seven Cs" are:

  1. Embracing change
  2. Seeking collaboration
  3. Increasing communication
  4. Handling competition
  5. Managing conflict
  6. Influencing culture
  7. Cultivating influence

Two weeks ago, we explored the first three core competencies of the seven Cs. This week, we continue with competencies four through seven.

Handling competition

Physician-hospital competition is a nationwide issue that affects how hospitals and physicians relate to one another. Without a clear basis on which to proceed, your organization will flounder and shudder in the face of unmanaged competition. The following are strategies and tools to employ in this potentially volatile arena.

For instance, a solid conflict-of-interest policy that encourages full disclosure goes a long way in helping medical staffs and hospitals achieve the goal of figuring out how to collaborate and compete. A good starting point is to understand the myriad ways in which conflicts of interest can occur. Some of these include:

Physician-physician conflict:

  • Competitors performing peer review
  • Credentialing/privileging disputes

Physician-hospital conflict:

  • Leadership position at a competing hospital
  • Competing ambulatory services
  • Physicians in joint ventures with other hospitals
  • Physicians who are loyal to other hospital staffs
  • Medical staff leadership roles (e.g., vice president of medical affairs and paid chairs)
  • Physicians as governing board members

Physician group conflict:

  • Employed physicians
  • Exclusive contracts
  • Medical directors
  • CEO's "kitchen cabinet"
  • Joint-venture partners
  • Contracted services

Physician's personal conflict:

  • Personal relationships
  • Religious issues
  • Families/relatives with related or competitive interests
  • Physicians involved in competing or similar research
  • Ethnicity issues
  • Ownership or interests in device manufacturers

In recent years, hospitals have developed various strategies for handling competition from physicians. Some have pursued joint ventures for ambulatory services or opted to build service lines to try to force competitors out of the marketplace. Hospitals that pursue these options often deny medical staff membership to physicians with competing interests. Other hospitals prohibit physicians with competing interests from serving in leadership capacities. This is generally addressed in an economic credentialing policy adopted by the board.

Managing conflict

The way an organization handles conflict is often determined by its culture. Some cultures view every conflict as an opportunity to crush the competition through belligerence and bullying. Others are characterized by thoughtful responsiveness, sensitive to the feelings and concerns of others. A good starting point is to know your organization's style and then objectively analyze whether the strategic results are what you wish them to be.

Many organizations have little self-knowledge or recognition of their style. If we accept that conflict is a huge growth line in contemporary healthcare, then best practice is to design and implement a conflict management system.

In their book Designing Conflict Management Systems, Cathy A. Costantino and Christina Sickles Merchant state that there is a spectrum of alternative dispute resolution options that range from least invasive (those that allow disputants the most control over the process and outcome, such as negotiation) to most invasive (those that allow disputants the least control over the process and outcome, such as binding arbitration). What might such a progressive system look like for a medical staff and hospital?

Elements to consider, in ascending order of invasiveness, are:

  • Prevention, which includes partnering, joint venturing, consensus building, setting expectations and rules, and joint problem solving. The physician-hospital compact, defining the give-and-take between physicians and hospital, is an excellent practice in this space.
  • Principled negotiation to seek collaboration by separating people from the problem, focusing on interests and not positions, inventing options for mutual gain, and insisting on using objective criteria.
  • Facilitation by using mediation, principled negotiation, and conciliation.
  • Fact-finding mediation using a neutral expert.
  • Advisory ADR using results of early neutral evaluation and nonbinding arbitration.
  • Imposed settlement, such as binding arbitration.
  • Legal remedies (only if all else fails).

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