Healthcare Management: St John of God Health Care

This report delves into the different aspects of healthcare management in St John of God Health Care, including the impact of the political environment, organisational design, leadership and teamwork, financial resource utilisation, and attitude to technology.

Healthcare Management
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Table of Contents
Executive Summary:..................................................................................................................2
Introduction:...............................................................................................................................3
Political and policy environment:..............................................................................................3
Organisational design and coordination:....................................................................................5
Leadership and teamwork:.........................................................................................................7
Financial resource utilisation:....................................................................................................8
Attitude to and utilisation of technology:.................................................................................11
Conclusion:..............................................................................................................................12
References:...............................................................................................................................13

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Executive Summary:
For ensuring proper management of a healthcare institution such a hospital, the
healthcare manger must have complete information about the innate workings of the
institution. A healthcare institution like any other organization is influenced by the activities
of its internal as well as external environment. As a result of which it becomes very important
for the management to keep a track of its external environment, especially its competitors,
government rules and regulations and other such aspects. In addition to this, these
organizations must take a good look at their financial practices and the overall financial
health of the organization and take necessary steps if things go wrong. Leadership styles
being implemented in the organization and the kind of organizational design which is being
introduced is a vital aspect, which needs to be looked after as well. In the same manner,
understanding and implementing the necessary steps towards the successful operation of the
health care institution also becomes important. Thus, through this report, as a result, the
different aspects relating to the above-mentioned diverse topics of the Australian private
sector hospital St John of God Health Care has been taken into account. It is one of the most
reputed and third largest hospital chains currently operating in the island country. The impact
of the political environment and competitive environment, the kind of leadership approach
practised the financial activities of the hospital and the technological inclination of the
hospital has been looked into through this report.

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Introduction:
In order to successfully run a healthcare organization, the role of the managers is of
paramount importance. A healthcare manager must have the ability to understand the various
nuances and facets of the healthcare sector and the organization where he or she operates.
Knowing and understanding all the values, the real missions and objectives, of the health care
service becomes very important. With this in mind, the different important aspects of
Australia’s third largest private health care service, the St John of God Health Care has been
looked into through this report (Bloomberg.com, 2019). All the facets of the health care
organization right from the impact of political and policy environment, the organizational
design of the company as well as its stance and views on the use of technology, management
of financial resources and the kind of leadership practiced, has been delved into.
Political and policy environment:
St John of God Health Care is one of the largest and the third largest not for profit
private healthcare centre operating in the island country of Australia. This company is
specialised in offering various kinds of maternity, community, youth related medical and
surgical facilities along with the services of rehabilitation as well as pathological services.
Founded in the year 1871, the company, operates in the Australian locations of Melbourne,
Victoria as well as New South Wales etc.
The company operates in the health care industry of the country and as a result of which are
heavily influenced by the government norms and regulations. The recent spur of investments
made by the new government of Prime Minister Turnbull, has provided some relief for the
hospitals including that of St John of God. Record amount of financial resources are being
devoted towards the hospitals and the health sector in general. The Australian healthcare
industry has benefited through the massive investment of the Government of around $1

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billion in the health care sector. The spending on the hospitals has also considerably
increased with the Federal Government doing its own contributions towards the private
sector, through the Medicare schemes. The 2018 federal health budget has made huge
contributions towards the private health insurance schemes too. Some other significant
contributions made by the government in terms of contributing towards the quality of care
include introduction of performance quality ratings, $50million worth of financial support to
make improvements in terms of quality(ABC News, 2019). Most importantly, St John of God
had been working towards improving its adult and aged services section and the
Government’s decision of promoting independent living through various innovative
approaches, along with this the mental health support and as well as residential and
community centres are also being established and funds have been allocated for the same.
This has been a big boost for the health care expansion plans for St John of God with respect
to their adult and old age patients.
The company has also been working in close proximity with the government on the important
issues of suicide prevention as well as taking steps towards the creation of a mentally healthy
environment and ensuring complete well being of the people in general. The financial
investments in the field of suicide prevention of around $33.8 million have been regarded as a
lifeline for this venture(Health.gov.au, 2019). Along with this the impact of the actions of the
new business ventures of the business also has an impact on the performance and plans of St
John of God. As per the new reports posted by ‘The West Australian’, it has been observed
that St John of God has been experiencing problems with regards to the creation of new
Midland Hospitals. Higher amounts of commissioning costs as well as losses have led to a
decrease in the earnings of the company. The opening and operating of a completely new
hospital with massive investments of around $340 million was too much for the company to
bear. The company now has to sell its pathology division labs in order to counter the impact

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of the losses created by the Midland hospitals(The West Australian, 2019). Moreover the
hospital is frequently challenged in the market by its competitors, most notable of which is
the Ramsay Health Care, which is a major private healthcare provider operating in Australia,
UK, France, Malaysia as well as in France. It has been one of the most competitive rivals of
St John and has been making good progress, with its business. Along with Ramsay, St John
has been facing some stiff competition from one of the other large private healthcare of
Australia, which is the Healthscope. The company has been giving some tough time to St
John in terms of providing medical, surgical as well as psychiatric and rehabilitation services
and increased number of clinics. The company as of now has been working on the core
hospital services and is planning to change its strategies and plans a major focus on its
existing hospital related businesses.
Organisational design and coordination:
The organizational design used in any organization forms a very integral part of it. In
the case of St John of God, it is still the same. It is an incorporated association, where the
members are directors of the St John of God Australia Limited, which is a canon law entity
which has been created in the year 2004. It was created with the purpose of sponsoring the
ministry which was earlier sponsored by the Sisters of St John of God. With the creation of
the canon law entity, the Sisters became its members. These sisters share the sponsorship of
the ministry and it is this collaboration between the two of them that ensures good
governance and stewardship. The company has a Board which is appointed by the Trustees,
from those members who remain accountable to them for the discharging of their functions
towards stewardship and strategic development of the health care service unit. In terms of
governance, there is a specific system through which the health care group works towards
fulfilling the objectives of the organization. St John of God health Care Governance has been

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structured in such a way through which the best practices in the fields of innovation,
accountability and how the objectives are set, as well as how the various risks are assessed
and how they are effectively dealt with. In terms of the stewardship the total revenue of the
organization for the year 2017/18 has been around $1700 million and for the past five years it
has seen a consistent growth. In terms of the last year period, the revenue growth has been
only 11%, which has showed the downturn in the private health sector. A graphical
presentation of which has been provided below:
(Figure 2: Total revenue, sjog.org.au, 2018)
Similarly, it has been observed that hospitals are capital intensive in nature due to the
continued need for expansion, innovation and increased investments especially in the digital
arena of services. Opening of new Hospitals as well as making new refurbishments has come
with huge amounts of capital. Thus, stewardship of capital expenditure becomes very
important. The capital expenditure in terms of the facility as well as plant and expenditure has
been provided below. It has been seen here that there has been an increase in the facility
expenditure from last year but on an overall term, there has been a decrease.

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(Figure 2: Capital expenditure, sjog.org.au, 2018)
Leadership and teamwork:
The organization has made some great contributions in terms of bringing in new kinds
of leadership and new leaders, who have left no stones unturned in pushing the boundaries in
terms of taking the organization towards newer directions and heights. The organization has
always believed in participative or democratic form of leadership. It has been one of the chief
architects of the success of St John of God Health Care. In this kind of leadership, the leader
makes sure to include his or her employees in the decision making process, in order to make
them feel significant and making them a part of the entire business process, in order to make
sure that they are not left out in any form (Terzi and Derin, 2016). Although the leaders take
the final decision, but the contribution and views of the employees are also given due
importance and weight. Thus in a certain way, it helps in building the spirit of teamwork
which becomes very important for the overall health of the organization.The leadership
culture is also nurtured and developed at St John of God Health Care. Various leadership

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development programmes are developed and introduced for the senior doctors, burses with
the help of the Australian Institute of Management. The practice of appointing a Mission
Integration leader at each team, who is also a member of the senior leadership team, has also
given rich dividends to the organization. Such leadership programmes have been initiated and
implemented at St John of God Pinelodge and FrankstonRehabilitation Hospitals. Moreover
the health care organization has been very successful in inculcating this leadership culture by
introducing awards and recognitions in order to motivate employees to provide their best
forms of leadership and work towards the Hospital (Iqbal, Anwar and Haider, 2015). The
hospital has also been focusing on the recommendations which had been arising from the
Mission management Model, through which the new positions and work functions for new
managerial positions with the aim of improving the overall leadership pathways of the
hospital is being continuously done. The hospital has made some great contributions in terms
of taking business to greater heights with its own set of innovative and participative form of
leadership.
Financial resource utilisation:
Financial resources are one of the most important resources which help a company to
act swiftly in a systematic manner, without any problems or hindrances. Not only it is
important for undertaking long term investments, but it also is necessary for undertaking the
daily operational needs of the business and the organization (Karadag, 2015). Thus, the role
of financial resources and its judicious use is of vital importance for the growth as well as for
the survival of the business. In the case of St John of God health care, the management of the
financial resources is also necessary and crucial. When the financial performance of the last
two years of St John is carefully analysed, a number of important aspects could be seen. The
hospital has been working very hard in terms of savings its costs and taking judicious

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financial decisions. From the consolidated statement of income for the last year, shows that
the hospital has been working towards the lowering of its expenses, it has been successful in
keeping the medical and supply expenses at the same level for the last two years at a short of
$400 million, similarly in the case of the interest, amortisation and depreciation expenses has
also remained at bay around $82 million in the last two years. On the other hand, the revenue
earned from the hospital and other sources of medical has seen a steady increase from $1576
to $1632 million in 2017-2018. Although the income from the pathology has become nil in
the year 2017-18, as it had to shut down, for recovering the costs relating to the losses
encountered by the hospital from the opening of the Midland hospitals(The Irish Times,
2019). Moreover the net surplus from last year has also decreased from 33.9 to 33.1 million
dollars. In case of the liabilities in the statement of financial position, it can be seen that there
have been an improvement as total liabilities have decreased from $682 to $670 million in
2017-18, as well as the assets of the company has seen a steady increase from $710 to $745
in 2017-18. Moreover the cash at the end of the year has also increased from $33 to $38
million in 2017-18.A vivid pictorial presentation for better understanding has been given
down below. All these things point out to the fact that although the hospital has been
suffering from the various external pressures from its competitors and other problems, still
the management has been trying hard to take all necessary steps in making sure that the vital
financial parameters of the hospital remain healthy and intact. It shows the prudent planning
and financial decision making of the management of the hospital in view of the dismal
performance of the entire private health sector of Australia, in the recent times.

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(Figure 3: Consolidated Statement of Comprehensive Income, sjog.org.au, 2018)
(Figure 3: Consolidated Statement of Financial Position, sjog.org.au, 2018)

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Attitude to and utilisation of technology:
Technology is one of the most important aspects of any organization, with the world
being driven towards a technologically advanced future, taking all the necessary adaptive
measures has become the need of the hour. In the case of St John God of Health Care,
significant amount of financial resources are being invested towards these innovative digital
and technologically rich platforms, consisting of various tools and programs. The primary
intention behind this is the need for addressing the increasing diversifying needs of the
patients, the doctors as well as the other parts of the care giving fraternity (sjog.org.au, 2018).
It has increasingly taking bold steps towards the implementation of new technologies and
putting them into practice. Some of the most prominent examples have been provided below:
 At St John of God Ballarat Hospital, the cooling cap technology has been
purchased with the intention of helping the oncology patients, as it helps in
reducing hair loss of patients, which is a first of its kind provided by the
hospital.
 Keeping in mind the relaxation and ensuring a good stay for the patients, a
number of steps in the form of addressing the entertainment needs of the
patients by buying movies on demand, digital screens for hospital foyer,
cameras in chapel for ensuring live stream of prayer services for the
patients(The West Australian, 2019).
 The hospital, being one of the longest serving and largest one is dedicating its
time and resources towards making the technological adaptability process
much smoother, which results in improving the efficiency of the hospital as
well as improves the satisfaction of the customers.

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Conclusion:
Healthcare is one of the most important areas of any economy. It helps in assessing,
evaluating and keeping the general public in good and sound health. In this respect, one of the
largest private hospitals of Australia’s performance and internal environment has been looked
into with great detail. Thus, all the important aspects of St John of God Health Care from the
perspective of its political impact, right till its financial working aspects as well as its
organizational structure and leadership approaches has been discussed in here. The hospital
has been focusing on a participative form of leadership with increased focus and investment
of technologies. Although in general the health sector has not been having a good time due to
various market reasons, the hospital has been working towards maintain the financial health
of the hospital as well. it is expected that the internal working of the company would
continue to help the hospital work in a much better way.

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Karadag, H., 2015. Financial management challenges in small and medium-sized enterprises:
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