No Margin, No Mission: Health-Care Organizations and the Quest for Ethical Excellence

By Steven D. Pearson; James E. Sabin et al. | Go to book overview

7
COMMUNITY BENEFITS

A development officer at the Metropolitan Museum of Art in New
York City calls the chief executive of a national health plan to ask
whether the company would be willing to spend $50,000 to be a
“platinum” sponsor of an upcoming art show. The show focuses on
nineteenth century American art and will be open for three months.
Other confirmed major sponsors include a large bank headquartered
in New York and an airline. For top-tier sponsorship, the health plan
will be listed with the two other major sponsors on advertising for
the show and will be able to host at least one private reception and
showing of the exhibit. The CEO pauses. He lives in New York and
believes strongly in the value of the arts, yet he also knows that his
senior medical director has been asked to make budget cuts in free
immunization and health fair programs that the company has sup-
ported in the past. Should the health plan sponsor the art show if it
means cutting back further on its health-related activities? Maybe
the health plan can do both, although the CEO worries about the
pressure he is under from Wall Street analysts to trim administrative
costs. And, after all, the health plan does pay taxes and has always
provided good jobs with excellent benefits. Does being a good cor-
porate citizen require it to do yet more for the community?

The CEO of a regional nonprofit health plan checks her appoint-
ment list and sees that she is to meet today with the executive di-
rector of her health plan’s foundation. The foundation is the entity
through which the health plan contributes to the community, but
in recent years, operating losses have forced the plan to cut back
severely on this line item of its budget. Now the tide has finally
turned. The health plan is back in the black, and its operating sur-
pluses are accumulating. That’s the good news. The bad news, at
least from the CEO’s viewpoint, is that she is now swamped with
hundreds of good proposals for what to do with the extra money
available. Higher provider payments, new disease management
programs, staff retention bonuses, information systems upgrades;
requests for all these and more are on her desk. The foundation’s
executive director has proposed that the health plan double his
budget and, to prevent wide swings in the future, he wants budgets
for the foundation to be set formally as an unchangeable percent
of corporate revenue. The CEO takes a deep breath and wonders
how to balance this request against all the other needs of the orga-
nization she is being asked to respond to.

-117-

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