Final Project_Module Seven

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Running head: MILESTONE SEVEN_FINAL PROJECT 1 Milestone Seven: Final Project Tina Brown Southern New Hampshire University HCM 415: Healthcare Strategic Management and Policy Professor Rachel Blackwood, MBA, PMP August 13, 2023
MILESTONE SEVEN_FINAL PROJECT 2 Table of Contents I. Overview II. Situational Analysis A. Analysis: Approach B. Analysis: Issue C. Analysis: Concerns D. Analysis: Role E. Analysis: Stakeholders F. Analysis: Policies G. Analysis: Mission and Vision H. Analysis: SWOT I. Analysis: Environmental Factors J. Analysis: Current Policies K. Analysis: Changes L. Analysis: Strategic Planning M. Analysis: Influence III. Recommendations A. Recommendations: Manager B. Recommendations: Driving C. Recommendations: Better Align
MILESTONE SEVEN_FINAL PROJECT 3 Overview Huntington Hospital (HH) is a 625- bed non-profit hospital that is in Pasadena, California and has outstanding accounts receivable (AR) days of 64 days, which is a key performance indicator for billing and collections (Drabkin & Soule, 2015). According to Drabkin and Soule (2015), Jim Noble, the executive VP-COO/CFO, was not happy with the current AR days for their organization and had a goal to lower the AR days to somewhere in the 50’s, because he recognized that based on HH’s payer mix, where their organization was located, and to achieve the mission and vision of the organization that a different strategic approach had to be taken to achieve the AR goal he wanted (Drabkin & Soule, 2015). A major component of HH’s mission and vision is to provide top quality, patient focused care and services to all their patients through internal and external collaboration with up-to-date technology and honor and respect to all individuals involved in their care (Huntington Hospital, 2023). To accomplish this change, Noble hired Kim Markey as the executive director of revenue cycle for HH’s Business Services Office (Drabkin & Soule, 2015). Noble wanted a manager who was a strategic thinker and not a manager who would come in and continue to focus on doing business the same way. After carefully evaluating the Business Service Office, Markey was able to conclude that the reason HH was experiencing such a high outstanding AR days was a result of a lack of formal written internal policies and procedures, inefficiencies in the processes that were currently in place within the collections department, no formal employee training, and no process in place for employees to suggest methods for improvements. (Drabkin & Soule, 2015). As a previous billing and revenue cycle manager for over 15 years, it is important for Markey to create a specific strategic plan that looks first at the mission and vision of the organization and then the key performance indicators that are important to the overall financial success of the
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MILESTONE SEVEN_FINAL PROJECT 4 organization. Moreover, Markey will also have to keep in mind any external factors that may potentially affect the strategic planning and implementation of her plan. Analysis: Approach Based on Marley’s extensive background, Noble knew that Markey was a strategic manager and thinker who would take a forward-thinking approach to things such as asking the right questions, evaluating the current systems involved and the relationships to internal processes, look at alternative approaches to solutions, evaluate internal policies and procedures, current and potential technology available, legislative, and political issues, competitive issues, and internal cultural atmosphere, etc. (Ginter et al., 2018). Part of the mission, vision, and values of HH include connecting employees, up to date technology, honor, trust, working together, oversight, and excellence (Huntington Hospital, 2023). Markey’s strategic approach and planning unknowingly focused on re-aligning the Business Service Office with the mission, vision, and values of HH. Because of Markey’s knowledge and background, the organization’s strategic approach was one that focused on re-engineering or rethinking the way HH was currently operating with the policies and procedures that were in place (Ginter et al., 2018). However, the strategic approach was also flexible enough for an emergent approach that allowed for any external changes that would affect the planning process, goals, or mission and vision or the organization (Ginter et al., 2018). Markey’s initial approach to help tie HH’s mission and vision to strategic planning process was to implement simple process changes such as an employee suggestion box, eliminating the early clock in rule, and she brought in outside consultants to provide additional guidance and training to the staff for reducing the AR days prior to the implementation of the new EHR system (Drabkin & Soule, 2015). These simple initial changes were part of the re-engineering process of tearing down the walls between the
MILESTONE SEVEN_FINAL PROJECT 5 managers and employees, getting rid of the old culture and processes, and the start of implementing new processes and procedures. Analysis: Issue According to the case study, the main issue in question is that HH has a key billing indicator of an AR days of 64, which is high considering the size of their organization, the payer mix that the organization has in their patient accounts receivables, and the location of the facility (Drabkin & Soule, 2015). One of the most successful key performance billing indicators for a hospital or a healthcare provider is to have a low number of days in outstanding AR, this number will vary depending on the organization payer mix, location, and size of the organization. However, according to Geisler (2021) most organizations strive to have an outstanding AR days between 30-70 days and anything over 50 days would indicate internal issues with the billing and collection process within the organization. Analysis: Concerns The overall strategic planning concerns for HH regarding this issue are the lack of effective policies and procedures and aligning the mission and vision of the organization with the key stakeholders (Ginter et al., 2018). Employees had expressed to Markey that they didn’t understand the expectations in their role due to inefficiencies in policies and procedures or inconsistencies in the messages between management (Drabkin & Soule, 2015). To address the concern regarding aligning the mission and vision Markey knew that she needed to break down any barriers between the managers and re-establish trust so that effective collaboration toward meeting the goals of the organization could take place going forward, including implementing new policies and procedures. According to Jill Geisler (2021), a strategic and forward-thinking manager like Markey must be able to take into consideration all these concerns such as employee
MILESTONE SEVEN_FINAL PROJECT 6 surveys, work culture and environment surveys, training, policies, and procedures development, and an overall understanding that all employees can add value to the organization. Analysis: Role The healthcare manager is an essential person in the strategic planning process, as this person helps with the overall creation, implementation, and ongoing management of the process. The healthcare manager at HH, Kim Markey, must first work with the executive leadership team to gain an understanding of the organization’s mission and vision to ensure that all strategic planning changes, etc., are in alignment with the mission and vision of the organization (Ginter et al., 2018). In addition, the healthcare manager at HH must be aware of any current external and internal issues that are affecting the organization’s outstanding AR days, as well as any other known issues that should be considered in the strategic planning process. Markey will also need to have alternative strategies ready for issues that may be known or unknown such as when HH fully implements the new EHR system or if a change is made in any federal or state reimbursement guidelines (Ginter et al., 2018). Moreover, the healthcare manager will be responsible for creating the action plan for the strategic plan. In this specific situation, Markey will be responsible for defining specific steps, assigning specific persons to complete each step, assigning a specific due date, and having regular meetings to verify progress, discuss obstacles, and make necessary adjustments to the plan. Analysis: Stakeholders Some of the key stakeholders involved in this issue are the Business Service Office employees and their respective managers, the healthcare manager, Kim Markey, the IT/HIM department, and the major insurance payers. The Business Services Office employees play a key role in the strategic planning process by providing valuable information regarding what they do
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MILESTONE SEVEN_FINAL PROJECT 7 daily, any obstacles they face performing their job, details regarding their interactions with patients about the organization’s billing and collections process, and details about their interactions with insurance companies regarding billing and collections issues such as denials, etc. All this information can be used to help improve and change current policies and procedures within HH and help reduce their overall AR days. The managers can also provide helpful information such as where there are current inconsistencies in processes and procedures, if there is missing information regarding payer contracts and billing guidelines, and issues related to obtaining information needed for claims submission, etc. The IT/HIM department plays a key role by providing updates and details about their current EHR system and capabilities, training available for employees, coding requirements, and security and privacy regulations that must be incorporated into policies and procedures. The major insurance payers play a very important role in the strategic planning process as they set the standards for how HH will bill their claims and how much money they will receive. It is important for HH to create specific guidelines and processes related to each payer based on their contract to help keep AR days within industry standards, as well as meet quality standards for their patients. Kim Markey, the healthcare manager, plays a vital role in the strategic planning process because she is responsible for taking the lead to ensure the plan is focused on incorporating the organization’s mission and vision and map out an action plan for the implementation of the strategic plan. Each of these stakeholders play an important role in the strategic planning approach as they can offer a different insight, knowledge, perspective, or suggestions regarding the proposed plan or strategic direction (Ginter et al., 2018). Analysis: Policies
MILESTONE SEVEN_FINAL PROJECT 8 According to the case study, Huntington Hospital (A): Empowering Staff , (2015), the Business Services Office at HH did not have any written policies in place to help address this issue of the increased AR days (Drabkin & Soule, 2015). HH did have informal processes and procedures that the employees were verbally told to follow by their managers. For example, the employees were told to use spreadsheets and perform tasks that they did not understand and that did not help them in their specific roles to help with the issue of the increased AR days (Drabkin & Soule, 2015). When an employee did not understand how to do something or had a question, they were required to email their respective manager instead of going directly to that manager to get answers and assistance. In addition, if one manager was not available and an employee went to another manager for help, the employee would receive a different direction because of the inconsistency and lack of communication between all managers (Drabkin & Soule, 2015). There was also no formal process for conducting meetings, as nothing was ever in writing for the information given during the meetings and any notes taken during meetings by employees were never validated by the manager(s) (Drabkin & Soule, 2015). Employees lacked formal training to do their jobs, and this was evident when new employees were hired and expected their managers to train them; however, that did not happen and employees were left to learn on their own or go to a fellow co-worker, in hopes to learn the correct information (Drabkin & Soule, 2015). Prior to Kim Markey’s arrival, the lack of formal written policies and procedures and formal training left employees feeling fearful, afraid, and confused about how to perform their jobs, as well as created an environmental culture of low employee morale. Part of Kim Markey’s goal was to remove these obstacles so that AR days could be decreased, HH could continue to be the top- performing hospital in the area, and HH could achieve their mission and vision (Drabkin & Soule, 2015). As a start, to help with the internal environmental issue of low employee morale,
MILESTONE SEVEN_FINAL PROJECT 9 Markey did implement an open-door policy for employees to come talk to her since they felt as if they could not approach their own managers face to face. She also implemented a new policy that employees didn’t have to wait 5 minutes before their shift to clock in so that employees didn’t feel like they couldn’t come to work or feel as if they are part of a team (Drabkin & Soule, 2015). One additional process that Markey implemented to help with the current confusion in the internal processes in place was to hire two outside consultants to help train some of the Business Service Office staff to decrease the current AR days prior to the implementation of the new EHR system (Drabkin & Soule, 2015). The simple changes in processes and policies were small steps in the strategic planning process to help address some of the barriers and obstacles that were identified as hindering the reduction in the AR days from decreasing. Analysis: Mission and Vision The strategic planning of re-engineering or recreating the processes and the way in which HH was conducting business within the Business Services Office that Markey was implementing to decrease the AR days had a clear focus (Ginter et al., 2018). Markey’s focus was on alignment with HH’s mission, vision, and core values that included improving employee collaboration, employee communication, the workplace culture, building trust and respect, and enhancing technology Huntington Hospital. (2023). By using an employee suggestion box Markey’s goal was to improve employee morale, increase employee/manager collaboration, and create a sense of confidence and trust among the managers (Drabkin & Soule, 2015). Markey’s open-door policy also showed that, as a manager, she was always approachable. This policy showed that Markey respected her employees, valued their opinion and feedback, and did not see herself as above them. Markey realized that before an effective action plan could be implemented for the strategic plan, she needed the employees to know they were valued and SEE the mission and
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MILESTONE SEVEN_FINAL PROJECT 10 vision of the organization through her actions. Simply telling employees and managers that they needed to change would not be an effective plan, Markey had to create collaboration, break down walls, and eliminate the old ways of doing things to move forward with the new plan to reduce the AR days (Ginter et al., 2018). Analysis: SWOT HH does have several strengths, weaknesses, opportunities, and threats (SWOT) surrounding the issue of their high number of AR days. The use of a SWOT analysis within an organization provides a high-level overview of both the internal and external issues that may need to be further addressed surrounding a specific issue or problem. The biggest strength for HH is that they have hired Kim Markey, who has been able to grasp the mission and vision of the organization and apply them to the strategic goals of reducing the AR days, as mentioned above. Unfortunately, one of their biggest weaknesses is their lack of written internal policies and procedures within the Business Service Office department, which is most likely the reason for the AR days being at 64 (Drabkin & Soule, 2015). When an organization does not have written internal policies and procedures in place for their employees, there is no direction, confusion, lack of leadership, and inconsistency in work productivity and efficiency. While there are several opportunities available to HH, the current workplace culture is causing employees to have very low morale, feel fearful, anxious, and stressful (Drabkin & Soule, 2015). Lastly, a key threat that will need to be addressed in the alternative planning is the fact that the current assistant director, who is impeding any changes and planning by Markey is not retiring for another year (Drabkin & Soule, 2015). Each item in the SWOT analysis is not necessarily in order of priority so it is important that each item be carefully analyzed further to determine what additional strategic planning HH should take to remove any obstacles to help reduce their AR days.
MILESTONE SEVEN_FINAL PROJECT 11 Strengths Top performing hospital in their area Newly hired, experienced executive director of revenue cycle Varied payer mix Good location Weaknesses Lack of written internal policies & procedures Poor/ineffective communication between all departments and employees Inefficient billing system Opportunities Implementation of new EHR system Bad/poor workplace culture Training from outside consultants Threats Current assistant director not retiring for another year Changes in Medicare reimbursement policies and guidelines Analysis: Environmental Factors There are some environmental factors that are related to HH’s current AR days and have a potential impact on the delivery of care within the organization. One is the implementation of the new EHR system. The implementation of a new EHR system in the organization can have a positive impact on the delivery of care in a variety of ways. EHR systems provide the opportunity for HH to obtain more accurate patient demographic information up front, verify a patient’s insurance and eligibility information in a timely manner, maintain and record medical record information for billing purposes, and calculate and collect patient cost shares more efficiency and effectively up front during the registration and scheduling process. The new EHR system will also allow for the ability of the organization to submit claims to payers in a more timely and efficient manner; therefore, being able to potentially decrease their AR days. In one study conducted regarding the availability and usage of technology within an organization showed that the workplace environment, communication, and management capabilities were tied to a decrease in length of stay, improved quality of care, and a decrease in staff turnover (Lundstrom et al., 2002). In addition to the implementation of the EHR system, the poor
MILESTONE SEVEN_FINAL PROJECT 12 workplace culture is having a negative impact and needs to be addressed immediately for positive outcomes to be recognized. Some of the policies and procedures that will help address this issue are to have written policies and procedures, an integrated team’s approach that shares information, and the creation of self-managed teams (Lundstrom et al., 2002). Policies and procedures provide clear guidance and direction for employees, while allowing for a team’s approach that shares information is a collaborative strategy that will allow for innovation and growth between the different departments. Another environmental factor is the training from the outside consultants that Markey has hired. The two consultants can provide the Business Service Office with the written policies and procedures that they have been lacking. According to Drabkin and Soule (2015), during the time frame the consultants were trying to map out the complete AR collection process with the Medicare collection team, they were unable to complete the full mapping process due to reliance on other departments. Once these obstacles are removed, the two consultants will be invaluable to assist the organization in mapping out a written process, as well as identify any other barriers that will help in reducing the total AR days. One last environmental factor that may be affecting the AR days is the current payer mix and contracts. HH’s outstanding AR days may be affected because of specific payer contract billing requirements that are not being followed. As such, HH needs to examine their payer contracts to ensure they are following their payer billing requirements and implement any necessary policy and procedure changes to help reduce outstanding AR days. Analysis: Current Policies The current organizational policies and procedures address the influence of the above- mentioned environmental factors in several ways. Since the organization high a higher than industry standard AR days of greater than 50 days, it is evident as to why HH is in the process of
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MILESTONE SEVEN_FINAL PROJECT 13 implementing a new EHR system (Drabkin & Soule, 2015). The current billing system and processes being used are ineffective and are contributing to the increase in the AR days. Moreover, the poor workplace culture was easily influenced and caused by the lack of written policies and procedures for the Business Services Staff to follow, inefficiencies in current processes, and no process in place for employees to suggest methods for improvements (Drabkin & Soule, 2015). It is not known or evident that HH has any policies procedures in place regarding how they review and exam their current payer contracts. However, since their AR days are above industry standard there are some billing and collection issues that are influencing their payer billing and collection guidelines, thus resulting in the AR days being greater than 50 days. It is fair to say that the current policies and procedures that are in place at HH are not adequately addressing the environmental factors in a positive way. Analysis: Change From the perspective of a previous billing manager there are numerous internal policy changes that need to be implemented to address the outstanding AR days at HH. These policies would fall under an organizational policy or a payer and regulatory policy (Drabkin & Soule, 2015). Some organizational policies that should be implemented at HH include: 1) administrative policies such as clocking in and out procedures, 2) IT/HIM policies such as how and when updates are made and communicated with staff, 3) a new hire training policy that also includes ongoing educational and annual training, and 4) a policy regarding HH’s internal billing and collections. Some regulatory policies that should be implemented at HH include policies regarding federal and state reimbursement guidelines, including any specific contract information, and a quality improvement policy that includes a process improvement process for internal employees. Each policy should have a defined purpose, goal, and specific steps or
MILESTONE SEVEN_FINAL PROJECT 14 procedures related to the policy. For example, the internal billing and collections policy should identify key metrics that each employee should meet and the steps to take to meet those metrics. Analysis: Strategic Planning The role of the healthcare manager will be vital in the strategic planning process of the policy creation at HH. The healthcare manager will be the leader and work with the key stakeholders within HH to ensure that any issues identified are prioritized and addressed appropriately, according to the mission and vision of the organization or any other external issues that may be a factor such as impending payer issues, regulatory guidelines, etc. (Drabkin & Soule, 2015). Another key role the healthcare manager must take into consideration in the planning process of policy creation at HH is understanding the organizational culture, both the cognitive and the emotional, as changing the culture at HH will be challenging and a vital role in helping HH realize their vision and goal (Drabkin & Soule, 2015). After assessing the structure of HH’s organization, the healthcare manager will then determine which value-adding support strategies will be needed to incorporate into the policies and procedures the organization needs. For example, HH will need to change their structure and take a re-engineering approach to how they have been doing things within their organization. This approach will need to be communicated by the healthcare manager and seen in the development of the policies at HH. Analysis: Influence All stakeholders expect to see value in what an organization can offer them. Therefore, while there are many stakeholders involved at HH regarding the strategic planning process, not all would be included in the process for policy change and development. Some of the key stakeholders who would influence the process for the policy changes and development for the issue at HH would include the employees, the healthcare manager, the HR department, the IT
MILESTONE SEVEN_FINAL PROJECT 15 department, the financial services department, and the COO/CFO. Part of creating policies and procedures within an organization is to communicate that the employees within the organization understand the values that the stakeholders expect of them (Drabkin & Soule, 2015). In other words, the policies and procedures will explain how HH will perform business and define the goals about performing that specific business. The key stakeholders, 1) the employees who perform the job on a daily basis, 2) the healthcare manager who has performed an internal analysis to determine the need for the policy changes and development, 3) the HR department who needs to be involved to ensure compliance and regulatory guidelines are followed, 4) the IT department who will verify that all technological components can be met with any policy changes, 5) the financial service department who will ensure that all payer contracts are reviewed and up to date and also that all policies meet the payer contract guidelines, and 6) the COO/CFO who will verify that all policies and procedures meet the mission and vision of HH, as well as be the voice of the CEO and upper management. Each of these key stakeholders has a unique role and perspective in the strategic planning process and policy creation. These key stakeholders influence the strategic planning process in terms of policy changes at HH because their inclusion in the process will help the healthcare manager establish the value-added strategies necessary to include within the policies and procedures created (Drabkin & Soule, 2015). These value-added strategies include how they will perform their pre-service, point of service, and after services activities. Recommendations: Manager The best course of action that I would recommend the healthcare manager take for the strategic planning to reducing the AR days is to first meet with executives and upper management within HH to ensure that there is a clear understanding of the mission and vision
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MILESTONE SEVEN_FINAL PROJECT 16 fulfilling the strategic plans that will be implemented (Drabkin & Soule, 2015). After the healthcare manager has met with the executives and a mutual understanding and consensus is reached regarding the strategic planning, the healthcare manager should create a written action plan that is specific to each step throughout the plan, who is responsible for what, when it should be completed, and any necessary resources that may be required to accomplish the goal (Drabkin & Soule, 2015). When employees know and understand what changes are being implemented, why, and feel like they are contributing to those changes, there is more of a buy-in to the strategy and changes taking place within the organization. Employees want to feel as if they belong and are making a difference in their roles within an organization; therefore, including them in the strategic planning and implementation process will help HH achieve their goal of reducing the AR days into the 50’s. Employees at HH were already asking for help and coming to their managers with suggestions for improvements, but they were not being heard, a strategic thinking healthcare manager such as Kim Markey would use these specific issues to help with the strategic planning and implementation process and include some of these employees in improving the current processes within the Business Service Office department (Drabkin & Soule, 2015). Recommendations: Driving To ensure that all the key stakeholders are involved in driving the strategic planning process for HH is to perform a situational analysis. This will include all the key stakeholders examining what HH should do about the current issue, what HH wants to do about the current AR days issue, and what HH can do about the AR days issue (Ginter et al., 2018). Based on the information provided by each of the stakeholders, the healthcare manager will be able to determine specific areas where she can hold them accountable such as the timeliness integration
MILESTONE SEVEN_FINAL PROJECT 17 of the new EHR system to help reduce the AR days (Drabkin & Soule, 2015). I would be sure to have ongoing, regular meetings that communicate the status of each goal. During these meetings, updates to each of the following would be provided: deadlines and goals, any obstacles or additional resources that may be required, feedback or suggestions, and successes. One method to use for updating all key stakeholders during these meetings, driving the strategic planning, and holding the stakeholders accountable is the balanced scorecard approach. The balance scorecard approach provides an important connection between strategy implementation, regulation, and management (Ginter et al., 2018). Most importantly, after strategic plans have been established and implemented, they must be monitored to verify their success. The healthcare manager must have a contingency plan ready in case another direction needs to be taken or adjustments need to be made to the plan or any steps in the plan. Recommendations: Better Align The HH organization can better align its strategic planning and policy processes with its overall mission and vision regarding this issue by including the Business Service office employees, their patients, some of their key payers, and providers in establishing potential goals and key metrics. Almost all employees within HH’s organization can offer important information to the planning process based on their interaction with customers, suppliers, competitors, and other stakeholders by performing their work daily (Moseley, 2018). The re-engineering strategic planning approach that HH and the healthcare manager were taking involves starting over or re- creating their current policies and procedures (Ginter et al., 2018). Markey knew what the mission and vision of the organization was and realized that the mission and vision of the organization was not being fulfilled within the Business Services office. This was evident in the many employees who expressed their dissatisfaction, anxiety, lack of training, etc. (Drabkin &
MILESTONE SEVEN_FINAL PROJECT 18 Soule, 2015). To better align HH’s strategic planning and policy processes with its overall mission and vision Markey will need to include the input from the key stakeholders to help create the written policies and procedures necessary to achieve the desired outcome of reducing the AR days. If HH conducts patient surveys, surveys can specifically include and identify information needed to help improve the current policies and procedures within the Business Services Offices that have an impact on patient billing and outstanding AR days. By including key payers, HH can also identify areas for improvement regarding billing and claims issues that may be impacting their AR days. This information can be used to educate employees, improve their current IT processes, or update current policies and procedures. Lastly, by including providers in the process, HH will gain better insight surrounding any potential issues their providers are experiencing regarding coding, IT systems issues, or other issues that may impact the AR days. To confirm that the policies and procedures created are aligned with the mission and vision of HH, Markey can use the Lean Six Sigma process. This is a five-step process that helps to define, measure, analyze, improve, and control an identified problem or concern, while also adding value and eliminating areas where waste is identified (Ginter et al., 2018).
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MILESTONE SEVEN_FINAL PROJECT 19 References Drabkin, D. & Soule, S. (2015, July 15). Huntington Hospital (A): Empowering Staff. Stanford School of Business . Case: OB-91(A). https://bcs.wiley.com/he-bcs/Books? action=mininav&bcsId=11121&itemId=1119349702&assetId=450390&resourceId=4394 1&newwindow=true Geisler, J. (2021, April). How organizations can take a comprehensive approach to DEI initiatives: To achieve substantive change, leaders must ensure diversity, equity and inclusion are pillars of organizational cultures. Healthcare Financial Management, 75(3), 38+. https://link-gale-com.ezproxy.snhu.edu/apps/doc/A663350332/ITBC? u=nhc_main&sid=bookmark-ITBC&xid=a2d255c6 Ginter, P. M., Duncan, W. J., & Swayne, L. E. (2018). The Strategic Management of Health Care Organizations (8th ed.). Wiley Professional Development (P&T). https://bookshelf.vitalsource.com/books/9781119349716 Huntington Hospital. (2023). Introducing Huntington Health. https://www.huntingtonhealth.org/about-us/ Moseley III, G. (2018). Managing health care business strategy. Jones & Bartlett Learning.