Emanuel Medical Center
Situational & Decision Analysis
James T. Onisk 4/29/2012
Table of Contents Situational Analysis Appendices External Analysis Appendix A: S.W.O.T. Analysis Appendix B: External Trend/Issue Analysis Appendix C: Environmental Trends/Issues Plot Appendix D: Stakeholder Map Appendix E: Service Area Profile Appendix F: Service Area Structural Analysis Appendix G: Service Area Competitor Analysis Appendix H: Critical Success Factor Analysis Appendix I: Mapping Competitors Appendix J: Synthesizing the Analysis Internal Analysis Appendix K: Financial Analysis Appendix L: Value Chain Strengths and Weaknesses Appendix M: Value Chain Competitive Advantages Relative to Strengths Appendix N: Value Chain Competitive Disadvantages Relative to Weaknesses Appendix O: Strategic Implications of Strengths and Weaknesses References Decision Analysis Decision Analysis Appendices Appendix P: Directional Strategies Appendix Q: Adaptive Strategies Appendix R: Market Entry Strategies Appendix S: Strategic Positioning Appendix T: Value-Chain Funcations References 1 2-11 12-13 14-17 18-29 30-36 37-50 51-60 61-66 67 I-VII
68-74 75-81 82-86 87-91 92-95 96-105 VIII-XV
106-109 110-122 123-125 126-128 129-135 136
Issue Statement Emanuel Medical Center (EMC) is encountering tremendous financial troubles as it struggles to remain open as an independent general acute care hospital. Changes in federal regulations such as the implementation of the EMTALA laws and lower reimbursement rates for federally run insurance programs, changes in service area demographics, and the evolution of the services that locally competing hospitals offer, all have contributed to five consecutive negative operating margins for Emanuel Medical Center. Emanuel Medical Center’s poor infrastructure and inability to adapt to these changes has left the hospital on the brink of closure. Highlights of the S.W.O.T. Matrix Federal regulations through the EMTALA laws require mandatory treatment for emergency room visitors by hospitals. This law impacts Emanuel Medical Center because the hospital not only is an old facility, but it was built to withstand a capacity of sixteen-thousand emergency visits per year. After the enactment of this regulation, the Emanuel Medical Center emergency department has seen a yearly rise in use to the point where it treats over forty-five thousand patients every year, posing a large threat to the hospital. The small emergency department facility- combined with a shortage of emergency department staff- frequently results in long waiting periods for patients. Patients growing frustration can result in a bad reputation for Emanuel Medical Center’s services and a loss of market share, as some patients may travel to competing hospitals or smaller urgent care clinics to receive care. Along with structural and capacity weaknesses with the emergency department, the patient mix that it treats reveals another vulnerability of the hospital. About fifty percent of the patients that EMC treats in their emergency department are insured by Medicare or Medi-Cal (California’s Medicaid program). The large numbers of Medicare and Medi-Cal patients exposes the hospital to financial struggles because of low-reimbursement rates that hospitals receive from these programs as a result of providing care. These federally funded programs frequently reimburse at such extremely low rates that hospitals may lose money by treating patients to patients due to the overhead costs associated with providing services. It is important for Emanuel Medical Center to focus on improving its patient mix-
which may be accomplished by increased advertising to a target market of fully insured people within the hospital’s service area - in order to become finically successful. Another threat to the financial stability of Emanuel Medical Center is that local competitors offer a wider range of services, many of which are...