Healthcare Reform and King County Community Health Centers: An Analysis of Organizational Strategic Planning

Abstract

This thesis focuses on the organizational strategic planning processes employed by five federally qualified community health centers (FQHCs) in King County, Washington in response to the Patient Protection and Affordable Care Act (PPACA). The research questions addressed include: What strategic planning processes are these FQHCs using, and how do they compare to published best practices? Are Community Health Centers (CHCs) using the same, similar or different strategic planning processes and why? This descriptive study draws on established research from the fields of organizational behavior and management theory. Previous research on organizations indicates that the strategic planning process within organizations is highly influenced by the pace and intensity of change in the external environment. Furthermore, the planning process is mediated or shaped by many variables, most notably culture, history, leadership and available resources. Measurement tools and the types of information available to the researcher allowed for the investigation of culture, history, size of market served, and a proxy measure for available resources, the administrative resources of each CHC. Because these mediating variables shape the outcomes as well as the means of strategic planning, they are hypothesized to have a significant impact on the performance of strategic planning best practices. This research investigates how CHCs in King County conduct strategic planning in response to healthcare reform, in the process revealing how these organizations are assessing the environment and adapting to the changes according to their distinct organizational compositions. CHCs maintain a unique position in the healthcare market, in that their mission is to serve all patients irrespective of ability to pay. Accordingly, a majority of their patients include Medicaid eligibles, the un- or under-insured and the undocumented. Since healthcare reform aims to insure over 37 million additional U.S. citizens (an estimated 320,000 in King County) by 2014, the purchasing power of many individuals included in CHCs’ patient population is expected to drastically increase. In addition to this increase in demand, PPACA includes provisions that will increase the supply of primary care providers as funds are allocated toward capital and operational capacity for CHCs. Specifically this includes support for work force development as well as the distribution of grant funding for the expansion of CHCs through the Community Health Centers Trust Fund. CHCs’ strategic planning processes are central to how they will carry out their mission in this changing environment.