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Governance in the Sunshine

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Lauren McDonald, MD, served on two hospital boards in the Dallas area before joining the board of managers at Parkland Health & Hospital System, where she currently serves as chairperson. She could be forgiven for thinking of those first two board stints as the good old days.

“If those boards want to talk about how much money they are spending here or there or the fact they want to acquire property X from persons Y and Z, or if they want to go off the agenda, no one really minds,” she says. “They don’t have anyone policing them.”

Not so at the Dallas County Hospital District, owner of the 725-staffed-bed Parkland Memorial Hospital. That board is governed by the Texas Open Meetings Act, which requires public boards to do their business in public.

“The philosophy of it is ideal, but at times it can make business for us very difficult,” she says.

Under Texas law, the only issues that can be discussed in closed session are those that involve attorney-client privilege. No more than two of the seven board members can discuss anything outside of an official meeting. Meeting agendas must be posted at least 72 hours before start time, and agendas must be followed.

Only a small percentage of American hospitals—in general, hospitals that are owned by or closely tied to a governmental entity—live under open meetings, or sunshine laws. But many of those that do are at a disadvantage from their competitors, says Mac McCrary, a hospital governance consultant based in Morganton, NC.

“It’s like playing poker, and you’re playing with your cards face-up and I’m playing with my cards held close to my chest,” he says. “I’m probably going to win.”

Indeed, he wonders whether a steady decline in the number of public hospitals might be correlated to the competitive disadvantage caused by open meetings rules. Between 1996 and 2002, the number of public hospitals in America’s 100 largest cities and their suburbs fell by 49, according to a 2005 study sponsored by the Robert Wood Johnson Foundation.

Anne B. Camper, a healthcare business attorney at Powell Goldstein in Washington D.C., has witnessed that competitive disadvantage in action. One of her clients, a city-owned hospital, wanted to buy land to build a facility in a fast-growing part of the community. The plans became public via a board discussion in an open meeting.

“Before they were able to contract, one of their competitors had moved ahead with a project to build in the same area,” she says. The competitor’s move rendered her client’s plan dead on arrival.

Specific details of open meeting laws vary considerably from one state to the next, with Texas being among the most stringent in its definition of “open.” Camper, who represents the National Association of Public Hospitals and Health Systems, frequently tries to get states to issue exemptions from open meetings and open records laws to allow public hospital boards to keep certain discussions under wraps.

For public hospitals that have such exemptions, an open meetings law poses no problem. At Albemarle Health in Elizabeth City, NC, for example, President and Chief Executive Officer Sharon Tanner says her life is made easier by a section of North Carolina General Statutes with a pleasing title: “Relating to Competitive Healthcare Information.”

Albemarle, with 142 staffed beds, is operated by a hospital authority. If Tanner wants to talk strategy with her board members, the accommodating statute is invoked. “We have open session, then we go into closed session and have whatever conversations we need to have, come out of closed session, and go back into open session,” she says.

Similarly, public hospitals in Louisiana are subject to an open meetings law that allows strategic planning to occur behind closed doors. Calvin Green, CEO of Franklin (LA) Foundation Hospital, a 25-bed critical-access hospital, says long- and short-term goals and objectives, as well as the strategies to reach them, are discussed in closed session. After the details have been worked out, board votes occur in open session.

That probably sounds sweet to McDonald, the chairperson at Dallas’ famed Parkland Memorial. Increasing transparency has been one of her top goals.

“Before I was board chair, we had a group of board members who wanted everything to be done behind closed doors,” she says. “That was wrong.”

And yet, the glare of sunshine sometimes can cause headaches. Parkland is the primary teaching facility for University of Texas Southwestern Medical School, which is affiliated with the UT Southwestern University Hospitals, competitors to Parkland.

“At times we would prefer to keep our cards close to our vest until we have a coherent plan and something we feel will work best for Parkland,” she says.



Make It Work For You

As chief executive officer of a rural hospital, Don Annis knew he had a potential public relations disaster on his hands.

Crawford Memorial Hospital, a 25-bed critical-access facility in Robinson, IL, had no looming scandal about to erupt. Rather, the hospital’s longstanding tradition of providing low-cost physicals for high school athletes was in jeopardy. The annual one-day event had become so popular that physicians were reluctant to participate, worried about the responsibility—and liability—of quickly assessing the health of each athlete in a long line.

To avoid scrapping the physicals entirely, Crawford Memorial reworked the program and decided on an unusual—and free—public relations strategy. The new program was announced with great fanfare at a meeting of the Crawford Hospital District board, where Annis thanked the doctors for cooperating with the changes and highlighted advantages of the new system. Annis knew that local reporters would attend the meeting because, as a public hospital, the facility’s board meetings are subject to the state’s open meeting laws.

The result was just what Annis had in mind: the lead article on the front page of the local newspaper. “We took what some hospitals fear—the legal requirement to have open meetings—and used it as a way to communicate key information,” Annis says.
Annis and Jim Kincaid, chairman of the board, offered these tips for using open-meeting laws to your advantage:
  • Embrace the spirit of the open meetings law. “A track record of community trust is imperative,” Annis says, “and of course, that must be earned.”
  • Take extra steps to be open when controversy emerges. During Kincaid’s 15 years on the hospital board, issues have occasionally arisen that prompted dissension within the community. “On one occasion, we advertised it: ‘Bring your questions and come talk to the board,’” he says. “We set the board up in front of the people, and we had some really excellent discussion.”
  • Develop a good working relationship with local media. Annis makes sure reporters receive copies of written backgrounders that will help them understand complicated issues the board will discuss. He also positions himself as a “straight shooter” in interviews. “If you have a relationship in which you’re open and frank, it inoculates against a time when you might have a problem laying on your doorstep.”


Lola Butcher is a Springfield, MO-based freelance writer and a frequent contributor to HealthLeaders magazine.