Everyone is; should healthcare? Outsourcing: Issues in strategic planning, organizational culture, and organizational ethics

Expenditures for personal health services in the United States have doubled over the last decade. They continue to outpace the growth rate of the gross national product. Costs for medical care have steadily increased at an annual rate well above the rate of inflation and have gradually outstripped payers' ability to meet their premiums. This limitation of resources justifies the ongoing healthcare reform strategies to maximize utilization and minimize costs. The majority of the cost-containment effort has focused on hospitals, as they account for about 40 percent of total health expenditures. Although good patient outcomes have long been identified as healthcare's central concern, continuing cost pressures from both regulatory reforms and the restructuring of healthcare financing have recently made improving fiscal performance an essential goal for healthcare organizations. ^ The search for financial performance, quality improvement, and fiscal accountability has led to outsourcing, which is the hiring of a third party to perform a task previously and traditionally done in-house. The incomparable nature and overwhelming dissimilarities between health and other commodities raise numerous administrative, organizational, policy and ethical issues for administrators who contemplate outsourcing. This evaluation of the outsourcing phenomenon, how it has developed and is currently practiced in healthcare, will explore the reasons that healthcare organizations gravitate toward outsourcing as a strategic management tool to cut costs in an environment of continuing escalating spending. ^ This dissertation has four major findings. First, it suggests that U.S. hospitals in FY2000 spent an estimated $61 billion in outsourcing. Second, it finds that the proportion of healthcare outsourcing highly correlates with several types of hospital controlling authorities and specialties. Third, it argues that healthcare outsourcing has implications in strategic organizational issues, professionalism, and organizational ethics that warrant further public policy discussions before expanding its limited use beyond hospital “hotel functions” and back office business processes. Finally, it devises an outsourcing suitability scale that organizations can utilize to ensure the most strategic option for outsourcing and concludes with some public policy implications and recommendations for its limited use. ^

Texas Department of Health organizational structure changes: A reflection of public health policy and agency expansion, September 1, 1946--June 30, 1994

The premise of this study is that changes in the agency's organizational structure reflect changes in government public health policy. Based on this premise, this study tracks the changes in the organizational structure and the overall expansion of the Texas Department of Health to understand the evolution of changing public health priorities in state policy from September 1, 1946 through June 30, 1994, a period of growth and new responsibilities. It includes thirty-seven observations of organizational structure as depicted by organizational charts of the agency and/or adapted from public documents. ^ The major questions answered are, what are the changes in the organizational structure, why did they occur and, what are the policy priorities reflected in these changes in and across the various time periods. ^ The analysis of the study included a thorough review of the organizational structure of the agency for the time-span of the study, the formulation of the criteria to be used in ascertaining the changes, the delineation of the changes in the organizational structure and comparison of the observations sequentially to characterize the change, the discovery of reasons for the structural changes (financial, statutory - federal and state, social and political factors), and the determination of policy priorities for each time period and their relation to the expansion and evolution of the agency. ^ The premise that the organizational structure of the agency and the changes over time reflect government public health policy and agency expansion was found to be true. ^