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Some Serious DHMC Cost Cutting

There are two ways to manage an enterprise: a) sloppy, loose hiring and social welfare personnel policies that leave an organization with a low-performance, unhappy staff, or b) tight, rigorous direction where each day you ask whether your people are the best that they can be. The latter requires the occasional dismissal, but for the most part good people appreciate working for an efficient organization, and they stay. The former situation is only temporary: nobody works very hard, customer service is mediocre, and over time costs go through the roof.

Below is an example of what has to happen to an organization after decades of loosey-goosey, low-quality administration. As Phil might put it, poor leadership leads to an unsustainable situation. The Valley News reports:

DHMC Layoffs.jpg

DHMC does not enjoy the benefits of Dartmouth’s huge, inefficiency-supporting endowment (last year’s payout was $212 million — about 22% of the budget). After a couple of decades of weak management — instead of running a lean, efficient operation — the one option left to the hospital is massive layoffs. Only time separates the College from experiencing the same fate.

Addendum: When DHMC sloughs off the deadwood — people it should never have hired in the first place — it will serve its patients better, make decisions more quickly, and have resources to improve. Who knows, it might even be an example for the College?

Addendum: The Times describes — with arched eyebrows — how DHMC has ceased to be an Obamacare accountable care organization (ACO) — a widely adopted model for healthcare delivery devised by the Dartmouth Institute for Health Policy and Clinical Practice.

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