Use Strategic Partnerships to Improve Rural and Community Hospital Performance

Increasingly, hospital CEOs are seeking alliances with strategic vendors and other health care organizations to overcome financial challenges and maintain vital health care services.

Feb. 6, 2025 | | Written by Joe Thomason, SVP Hospital Operations, CHC

Why Relationships Matter

Relationships play a pivotal role in the sustainability and growth of community hospitals. Why? Because alliances allow resource-constrained facilities to tap into a wealth of information, technology and expertise that may otherwise be cost prohibitive.

In some situations, partnerships allow community hospitals to expand services, such as introducing telemedicine and offering specialized care like cardiology and podiatry, which might not be feasible independently. In other cases, partnerships provide access to best practices that enhance the overall quality of patient care. Collaboration is instrumental for increasing patient satisfaction and improving community health, along with solidifying the hospital’s vital role within its community.

Exploring Partnership Options

The process of finding partners should be tailored to a hospital’s unique needs, strengths, and challenges. The chosen relationships should aim to enhance revenue or reduce cost while supporting quality of care, patient satisfaction, and overall community wellness.

Before seeking partners, hospitals should identify their strengths and the areas requiring additional resources and support. Defining objectives and requirements up front also helps streamline the process by defining search criteria. Potential objectives may include improved geographic coverage, clinical integration, care-delivery efficiency, expanded services, cost reduction or enhanced clinical talent to name a few.

It’s also helpful to consider partner alignment with the hospital’s mission, culture, and resource needs. Shared goals offer mutual benefits.

Growth through Partnerships

Depending on a hospital’s needs, there are a variety of relationships that can create growth:

Service Expansion through Vendor Partnerships. Several hospitals have successfully introduced various services like telemedicine, hospital-at-home services, and wound care using vendors who provide turn-key services.
Service Expansion through Itinerant Physicians. For specialties like cardiology, general surgery, pain management, and podiatry, visiting physicians can allow a hospital to expand services and open new revenue streams.
Service Expansion through Clinical Affiliation. This specific level of affiliation enables the smaller facility to offer specialty care through telemedicine and/or access to specialty physicians who rotate and offer services on certain days at the smaller hospital. In return, the smaller hospital agrees to transfer its more complex cases related to that specialty to the larger clinical affiliate partner.
Hospital Performance Improvement through a Management Agreement. At times the local hospital board may want to maintain governance and control over the hospital while abdicating day-to-day management responsibility to an outside third party that offers more resources. Short-term, or interim-management relationships may occur when a local CEO leaves the organization and no suitable replacement is readily available. Long-term management relationships occur when the board desires an experienced reliable third party to oversee the day-to-day operations of the facility.

Best Practices for Partnerships

Clear communication, due diligence, and regular evaluation of the partnership’s effectiveness are critical in forming a successful alliance.

Strategic partnerships are more important than ever in today’s evolving health care landscape. With the right partner, hospitals can adapt to changes, simplify complexities, and maintain their financial viability.

About CHC
Community Hospital Corporation owns, manages and consults with hospitals through three organizations: CHC Hospitals, CHC Consulting and CHC ContinueCARE. Read more posts by CHC’s Joe Thompson.