A Hospital under Resource Constraints

The case of St. Joseph's Hospital at Roma, Lesotho,
as seen through a Management Audit Report

Excerpts from the Executive Summary

The management audit revealed that the most critical constraints facing the institution emanate from three major capacity constraints namely: financial, material and human resources.

The review noted significant effort, at the higher echelons of the institution, at improving the corporate governance profile of the institution, efforts which were inundated by severe resource constraints.

Financial resources by way of Government subvention averaging around 65% of the annual hospital budget, was only meant for wages of the professional categories of staff, yet significant amounts were needed to refurbish physical infrastructure, replenish ailing basic medical facilities, and pay for support services and utilities as well as wages of support staff. Besides, the Government grant was only meant to pay professionals at their entry (basic notch) level salaries.

The hospital was only capable of generating an average income of between 25-30% of its constrained annual budget, income that was barely sufficient to maintain a modern outfit.

The resource constraints imposed on the institution have had far reaching ramifications on management action including: inability to motivate staff, inability to hire suitable personnel, inability to source requisite equipment and supplies, and inability to meet maturing obligations.

The restraint imposed on management as a result of constrained resources, has reverberated to general staff as manifested in their responsiveness to duty, respect for supervisors, general attitude, behaviour, frustration, etc. The observed deterioration in the quality of service such as patient care, could partly be seen as an expression of disillusionment.

Highlights from the Report

Due to the hospital's total reliance on the Government subvention for professional and technical staff salaries, there is neither upward mobility nor salary enhancement. ... It has been established that all people in the same scale are at the first notch, regardless of number of years in the employ of the hospital. The view of the team is that this kind of situation does not allow people to assume voluntary leadership and thereby makes determination of seniority difficult. ... the apparent financial constraints has forced the hospital to adopt a less motivating payment structure, probably because it cannot afford anything other than what is coming from the Government subvention.

The review team gathered that the attitude of staff towards management, colleagues and their work was very negative and impacted negatively on the operations of the hospital.

Members of staff ... ascribed the prevailing negative attitude and poor relations to the apparent declining status of the institution, lack of management skills, shortages of medical supplies and equipment, and the general decline in resources. They perceived that the prevailing situation did not allow for professionalised service delivery as they could not perform certain procedures effectively. As a result, people were reluctant to implement management decisions and act professionally, perhaps due to frustration. People have now adopted the "I don't care" attitude. ... There was a general consensus from the nursing personnel, medical practitioners, management, patients' relatives (community) and review team that the quality of patient care was significantly deficient, in terms of nursing care, drugs, equipment and medical supplies.

An evaluation of control systems for handling finances and donations was carried out ... the review team gathered that the accounting function of the hospital was inadequately staffed in terms of requisite competencies. At the time of this review the hospital did not have a qualified accountant in place. Two assistant accountants were then managing the accounting function. It was also gathered, as a result of this deficiency, that the external auditor was preparing the actual financial statements in addition to auditing the same. It was further gathered that despite the existence of an elaborate accounting manual, the accounting personnel did not seem to be aware of its existence.

Operational income base, which is mainly charges to patients for various medical services, was rather too limited in generating sustainable income. Moreover, the inability of the hospital in collecting debt from patients was putting an additional strain to the already weak financial position of the institution.

The limits of strategic planning
Findings of the management audit team:

The review team gathered during the general staff meeting that there were widespread concerns that Management was doing nothing in the implementation of the Strategic Plan 1998-2001.

Further, the review team noted the general perception/mood of staff that it was pointless engaging consultants such as the current ones to carry out studies whose recommendations would only end up in the archives of the hospital.

In view of the above concerns, the audit team carried out a review of the extent by which said strategic plan provided strategic direction for management action as well as the extent to which the eight identified strategic options had been addressed.

Conclusions of the management audit team:

It must be noted ... that the strategic plan is a management tool developed by the Management of St. Joseph's Hospital in a consultative process that involved all stakeholders, including the hospital employees. Further, it must be appreciated that expected outcomes are the desires of all stakeholders, however, their achievement is heavily dependent on resource availability.

In our view, management had made great strides in the implementation of plans indicated in the strategic plan. The observed delays in carrying out some of the very good intentions are understandable in light of severely constrained resources. Besides, the fact that implementation was documented through annualised "Action Plans" was a positive indication of management effort and commitment.