Chapter 1

Nursing Leadership and Management

Objectives
Upon completion of this chapter, the reader should be able to:
o Differentiate between leadership and management
o Distinguish characteristics of effective leaders
o Identify leadership theories
o Apply knowledge of leadership theory in carrying out
the nurses role as a leader
o Identify concepts of management
o Identify management process
o Outline 10 roles that managers fulfill in an organization
o Relate management theories
o Summarize motivation theories
Leadership and Management
Leadership
o Influences or inspires actions and goals of others
o Leaders do not have to have position of authority
o Leaders are people who do the right thing
Management
o Managers are people who do things right
Leadership is part of management
o Not a substitute for it
Definition of Management
Process of coordinating actions and allocating resources to
achieve organizational goals
Managerial roles:
o Information processing role
Disseminate information staff needs
o Interpersonal role
Figurehead
Leader
Liaison
o Decision making role
Negotiator
Disturbance handler
Management Process
Planning
Organizing
Coordinating
Controlling
Staffing
Directing
 Reporting
Budgeting
Problem solving
Clarifying roles and objectives
Informing
Monitoring
Consulting
Delegating
Networking
Mentoring
Management Theories
Scientific management
o Focuses on productivity
o Emphasizes efficiency
Bureaucratic management
o Focuses on top-down organization and chain of
command
Human relations
o Focuses on individual worker as source of control,
motivation, and productivity in organizations
Motivation Theories
Motivation
o Whatever influences peoples choices and creates
direction, intensity, and persistence in peoples behavior
Theories useful because they help explain why people act the
way they do and how managers can relate to individuals as
human beings and workers
Maslows hierarchy of needs
o Motivation occurs when need unmet
Two-factory theory
o Two sets of factors:
Maintenance or hygiene
e.g., salary, working conditions
Motivation
e.g., responsibility, recognition,
advancement
Theory X
o Belief that, in bureaucratic organization, employees
prefer security, direction, and minimal responsibility
Theory Y
o Belief that people enjoy their work and are able to
contribute creatively
Theory Z
 o Collective decision making and long-term employment
Managerial Work
Nurses need to develop high-quality information systems that
provide feedback on frequent basis
Feedback can be powerful tool to assist managers in
motivating behavior
o Must be the following:
Frequent
Timely
Usable
Correct
Leadership
Process of interaction in which leader influences others toward
goal achievement
o Leaders influence others by inspiring, enlivening, and
engaging
Process involves leader and follower in interaction
o Reciprocal relationship
Leadership
Involves having vision and goals for what organization can
become and then getting cooperation and teamwork from
others to achieve goals
Formal leadership
o Leader has assigned role within organization
Informal leader
o Leader demonstrates leadership outside scope of formal
leadership role as member of group or leader of group
Leaders and Followers
Both roles necessary
o Leaders need followers to lead
o Followers need leaders to follow
Most valuable followers:
o Skilled, self-directed employees who participate actively
in needs of group
Good followers communicate and work well with others
Leadership and Management
Leadership is about creating change
o Involves establishing direction and aligning people
through empowerment
Management is about controlling complexity in effort to bring
order and consistency
o Involves planning, budgeting, organizing, staffing,
problem solving, and controlling complexity
Leadership Characteristics
 Fundamental qualities:
o Guiding vision, passion, and integrity
Desirable qualities:
o Intelligence, self-confidence, determination, integrity,
and sociability
Most valued qualities:
o Caring, respectability, trustworthiness, and flexibility
Leadership
Requires personal mastery
Is about values
Is about service
Is about people and relationships
Is contextual
Is about balancing
Is about integrity
Is about management of meaning
Is about continuous learning and improvement
Is about effective decision making
Is a political process
Is about modeling
Leadership Values
Are visionary and enthusiastic
Are supportive and knowledgeable
Have high standards and expectations
Value education and professional development
Demonstrate power and status in an organization
Are visible and responsive
o Communicating openly
Leaders versus Nonleaders
Differences across six traits:
o Drive
o Desire to lead
o Honesty and integrity
o Self-confidence
o Cognitive ability
o Knowledge of business
Leadership Theories
Classified according to approach
o Behavioral
o Contingency
o Contemporary
Behavioral Approaches
 Autocratic leadership
o Involves centralized decision making with leader making
decisions and using power to command and control
others
Democratic leadership
o Involves participatory leadership with authority
delegated to others
Laissez-faire leadership
o Is passive and permissive
o Leader defers decision making
Employee and Job-Centered Leaders
Employee-centered leadership
o Focuses on human needs of subordinates
Job-centered leadership
o Focuses on schedules, costs, and efficiency
Leader behaviors
o Initiating structure includes planning, directing others,
and establishing deadlines
o Consideration involves focus on employee and creates
trust relationship
Leadership Styles
Low initiating structure, low consideration
High initiating structure, low consideration
High initiating structure, high consideration
o Have better performance and satisfaction outcomes
o Have clear assignments and work considerately with
staff to achieve quality outcomes
Low initiating structure, high consideration
Managerial Grid
Five leadership styles:
o Impoverished leader for low production and low people
concern
o Authority compliance leader for high production concern
and low people concern
o Country club leader for high people concern but low
production concern
Five leadership styles:
o Middle of the road leader for moderate concern in both
directions
o Team leader for high production and high people
concern
Contingency Approaches
 Acknowledges that other factors in environment influence
outcomes as much as leadership style
Leader effectiveness contingent upon something other than
leaders behavior
Theories:
o Fielders contingency theory
o Hersey and Blanchard
o Path-goal theory
o Substitutes for leadership
Fielders Contingency Theory
Views pattern of leadership effectiveness as dependent on
interaction of personality of leader and needs of situation
Needs of situation involve leader-member relationships,
degree of task structure, and leaders position of power
o Good relationships exist when followers have trust,
respect, and confidence in leader
Situational Leadership Theory
Addresses follower readiness as factor in determining
leadership style and considers task behavior and relationship
behavior
Leadership styles
o Telling, selling, participating, and delegating
Leadership Styles
Telling
o For groups with low maturity who need direction
Selling
o For groups with moderate maturity who are unable, but
willing and need direction
Participating
o For groups with moderate to high maturity who are able,
but unsure and need support
Delegating
o For groups with high maturity who are able and need
little direction
Path-Goal Theory
Form of leadership when leader works to motivate followers
and influence goal accomplishment
o Based on expectancy theory
Leadership styles
o Directive, supportive, participative, achievement-
oriented
Leadership Styles
Directive
 o Provides structure through direction, focusing on task to

be done
Supportive
o Provides encouragement
and attention
Participative
o Focuses on involving followers in decision making
process
Achievement oriented
o Provides high structure and high support
Substitutes for Leadership
Variables that may influence followers to same extent as
leaders behavior:
o Follower characteristics
o Organizational characteristics
Follower Characteristics
Structured routine tasks
o Theory suggests nurses and other professionals with
great deal of experience
do not need direction and supervision
Knowledge serves as leadership substitute
Amount of feedback provided by task
Follower Characteristics
Presence of intrinsic satisfaction in work
o Substitutes for support and encouragement of
relationship-oriented leader
Contemporary Approaches
Address leadership functions necessary to develop learning
organizations and lead process of transforming change
Approaches
o Charismatic leadership, transformational leadership,
knowledge workers, and Wheatleys New Science of
Leadership
Charismatic Theory
Charismatic leader has inspirational quality that promotes
emotional connection from followers
o Characteristics:
Self-confidence
Strength in convictions
Communicate high expectations and confidence
in others
Transformational Theory
 Described as process where leaders and followers raise one
another to higher levels of motivation and morality
Leaders motivate others to behave in accordance to mutual
values and empower others to contribute
Transformational Theory
Leaders are identified as change agents, are courageous,
believe in people, are value-driven, are life-long learners, and
have ability to deal with complexity
Transactional leader
o Traditional manager concerned with day-to-day
operations
Transformational leader
o Motivates others to behave with values and
empowerment
Knowledge Workers
Bring specialized, expert knowledge to organization
Knowledge organizations share, provide, and grow information
to work efficiently and effectively
Workers with knowledge and expertise act as organizations
leaders
Using Knowledge
Nurses develop leadership and management skills with
continuing education and by increasing expertise
in patient care
Knowledgeable nursing leadership fosters good patient care
by providing supportive environment for nurses to deliver care
Using Knowledge
Nurses are provided clear chain of command, clear job
descriptions, patient care standards, and good staffing ratios
New Leadership
Leaders functions:
o Guide organization using vision
o Make choices based on mutual values
o Engage in culture to provide meaning and coherence
New Leadership
Fosters growth and unity between individual and members of
group
Strong relationships improve autonomy at all levels of
organization
Management
Managers
o People who continuously seek information
 Constantly engaged in interactions with others
who need information
Work
o Driven in random order
o Has range of importance and urgency
Management Roles
Information processing roles
o Monitoring, disseminating information, and acting as
spokesperson
Interpersonal roles
o Acting as figurehead, leader, and liaison
o Managing groups of people
Decision-making roles
o Acting as entrepreneur, disturbance handler, allocator of
resources, and negotiator
Management Process
Management
o Art of accomplishing things through people
o Includes planning, organizing, coordinating, and
controlling
Gulick and Urwick (1937) defined seven principles of process:
o Planning, organizing, staffing, directing, coordinating,
reporting, and budgeting (POSDCORB)
Yuki and colleagues (1990) describe
13 managerial functions:
o Role functions for managing work
Planning and organizing, problem solving,
clarifying roles and objectives, informing,
monitoring, consulting, and delegating
Yuki and colleagues (1990) describe
13 managerial functions:
o Role functions for managing relationships
Networking, supporting, developing and
mentoring, managing conflict and team building,
motivating and inspiring, and recognizing and
rewarding
Manager Resources
Human
Financial
Physical
Informational
Motivation
Whatever influences peoples choices and creates direction,
intensity, and persistence in behavior
 Motivation
Process that occurs internally to influence and direct behavior
in order to satisfy needs
o Motivation theories helpful to explain why people act
the way they do and how nurse managers can relate to
individuals as human beings and workers
Motivation Theories
Content motivation theories
o Maslows hierarchy of needs, Alderfers expectancy-
relatedness-growth (ERG) theory, Herzbergs two-factor
theory, and McClellands manifest needs theory
Process motivation theories
o Expectancy theory
o Equity theory
Feedback
Powerful tool to assist managers in motivating behavior
Should have value so nurses see when behavior needs to
change
Needs to be frequent and timely
Must be useable, consistent, correct, and of sufficient diversity
Benners Model of Novice to Expert
Provides framework to facilitate professional development by
building on skill sets and experience of each practitioner
Based on tasks, competencies, and outcomes practitioners
can be expected to have accomplished based on five levels of
experience
Levels of Experience
Novice
o Task-oriented
o Focused on rules and direction from telling-style leader
Advanced beginner
o Demonstrates marginally acceptable independent
performance
Competent nurses
o Have developed ability to see own actions as part of
long-range goals set for patients
Proficient nurses
o Perceive whole situation rather than series of tasks
Expert nurses
o Intuitively know what is going on with patients
o Expertise is embedded into practice
Chapter 2
The Health Care Environment
Objectives
Upon completion of this chapter, the reader should be able to:
Identify how health care is organized and financed in the
United States (U.S.)
Compare U.S. health care with that of other industrialized
countries
Upon completion of this chapter, the reader should be able to:
Identify the major issues facing health care
Relate efforts for improving the quality, safety, and access
to health care
Structuring Hospitals Around Nursing Care
Nightingale described importance of structuring hospitals around
nursing care
Physical environment of hospitals can create stress for patients,
their families, and clinical staff
Hospital design leads to improvements in:
Patient outcomes
Patient safety
Patient and staff satisfaction
Collecting Data
Data collected through patient records, surveys, and
administrative systems
Reports developed from this data provide valuable
information
Data displayed with charts and pictures to emphasize successes
and failures of health care throughout nation
Collecting Data
Incident report helps nurses identify errors and maintain attitude
of problem-solving
Rather than finger pointing
Organization of Health Care
Structure
Resources or structures needed to deliver quality care
e.g., nursing care, nurses, pharmaceuticals, hospital
buildings
Process
Quality activities, procedures, tasks, and processes
performed within health care structure
Outcome
Patient satisfaction, good health and functional ability, and
absence of health-acquired infections and morbidity
WHO Goals
 World Health Organization describes three primary goals for what
good health care should do:
Ensure health status is best possible across lifespan
Respond to patients expectation of respectful treatment
World Health Organization describes three primary goals for what
good health care should do:
Provide financial protection for everyone regardless of
ability to pay
Health Care Rankings
State-of-the-art health care available in U.S., but access limited
to those who can afford its high costs
Measured with five other high-income countries, U.S. ranked last
with respect to healthy lives, access, patient safety, efficiency,
and equity
Need for Primary Health Care
Primary care provides integrated, accessible health care
Includes health promotion and prevention and diagnosis
and treatment of illness and injury
Nurses knowledge, skills, and competency have been
underutilized
Four foundations of primary care:
First contact
Longitudinality
Comprehensiveness
Coordination
Federal Government
Provides for general welfare through collection and allocation of
money for oversight and administration of health
care programs
Oversees functioning of several sub-divisions and agencies
Constraints in delivering care come from infrastructure problems
and downturn in U.S. economy
Agency for Healthcare Research and Quality (AHRQ)
Centers for Disease Control and Prevention (CDC)
Food and Drug Administration (FDA)
Centers for Medicare and Medicaid Services (CMS)
Health Resources
and Services Administration (HRSA)
Indian Health Service (IHS)
National Institutes of Health (NIH)
Substance Abuse and Mental Health Services Administration
(SAMHSA)
State and Local Health
Includes health services at state and local levels
 Efforts to fight bioterrorism nationally have decreased funding for
health programs at state and local levels
Health Care Disparities
Socioeconomic status
Number one predictor of poor health
As one ages, more health care services utilized
Women have higher utilization rates than men
Whites have higher utilization rates than other races
Health Care Spending
U.S. health care system consists of mix of health care providers
from either nonprofit or for-profit organizations
53 percent comes from private insurance and individual
payment
Reimbursement for services paid in four ways:
Private insurers
Publicly funded payers
Charitable entities
Direct payment by consumers
Public Payers
Medicare
Funded by federal
Covers people over age 65
Medicaid
Funded by federal and state
Covers medically indigent
State Children's Health Insurance Program (SCHIP)
Funded by federal and state
Insures low-income, uninsured children
Veterans Affairs
Funded by federal
Covers veterans
Indian Health Services
Funded by federal
Covers American Indians and Alaska natives
TRICARE
Funded by federal
Civilian care for military
Rising Health Care Costs
Health care costs in U.S. increasing
2.5 percent faster than annual gross domestic product (GDP)
Employer-based health care premiums have doubled since 2000
Insured now incur more out-of-pocket medical costs
Medical debt now number one reason for personal bankruptcy
Contributing Factors to Rising Cost
Aging population
 Increased utilization of pharmaceuticals
Expensive new technologies
Rising hospital costs
Types of practitioners
Cost shifting
Administrative costs
Cost Containment Strategies
Cost containment strategies:
Use regulation and limitation by means of taxes and
insurance premiums
Encourage managed competition
Reimbursement strategies:
Use regulatory and competitive price controls
e.g., capitation, patient cost sharing, utilization
management
Health Care Insurance
Health maintenance organization (HMO)
Prepaid managed health care plan providing
comprehensive health care coverage for designated
services through group of health care providers
Preferred provider organization (PPO)
Provides services contracted with health care providers
who agree to provide designated services as they are
needed to group of people at discounted fee
Point of service plans (POS)
Managed care option that offers enrollees right to obtain
health care services from approved, participating, network
provider
Medicare, Medicaid, and SCHIP
Publicly funded coverage to those who qualify on basis of
low income, disability, and age
Capitation
Health care payment of fixed amount of money established
to cover cost of health care services delivered to patients
during specified length of time
Restricts fees paid by insurance plans to health care
provider for care and services needed by patient
Prospective payment
Introduced in 1982 by federal government
Developed as way to control costs
Intent was to offer financial incentives to encourage
hospitals and health care practitioners to provide more
cost effective care
Hospitals paid predetermined amount of payment for each
Medicare patient admitted
Health Care Quality
Two health care reports have shown health care quality in U.S. at
unexpected low level and needs improvement in many areas
To Err is Human
Crossing the Quality Chasm
Health Care Variation
Research has demonstrated significant variation in utilization of
health care associated with geographic location, provider
preferences and training, type of health insurance, and patient-
specific factors
e.g., age, gender
Hospitals and providers should adhere to patient safety
standards and establish national benchmarks
Health Care
Should be:
Safe
Effective
Patient-centered
Timely
Efficient
Equitable
Transparent
Should:
Have continuous healing benefits
Customize care
Share knowledge
Use evidenced-based practice
Improvements in the Process of Care
Need to utilize evidence-based care
Changing processes of care based on evidence could
change list of top 10 health care conditions
Need to change process of care delivery to save not only cost,
but mortality
Performance and Quality Measurement
Measured to:
Determine resource allocation
Organize care delivery
Assess clinician competency
Improve health care delivery processes
When quality of care measured, it improves
Reliable methods and measures need to be developed and
tested to be able to measure quality care
Malcolm Baldrige National Quality Award
Highlights importance of leadership and strategic planning in
building quality health care system
 Stresses importance of measurement, analysis and knowledge
management, workforce focus, and results
Outcome Measurement
Can be performed to indicate individuals clinical state, severity
of illness, and effect of intervention
Can be done to evaluate patients functional status
Will identify five indicators:
Clinical status
Functioning
Physical symptoms
Emotional status
Patient/family perceptions about quality of life
Public Reporting of Performance
Can be used to determine health care inefficiencies and poor
quality of care
Is used to influence reimbursement policies where payment is
linked to ability to achieve standards and benchmarks
Can be used as condition of doing business with organization
Used to influence clinician and patient utilization behavior
Institute of Medicine Health Care Reports
Institute of Medicine (IOM) 1996 launched effort to assess and
improve nations quality of care
Established problems as overuse, misuse, and underuse of
health care services
Set vision for how to close gap between good quality care
and what actually exists
Defined 10 rules for care delivery redesign
Other National Quality Reports
AHRQ National Healthcare Quality Report
AHRQ National Healthcare Disparities Report
Healthy People 2010 and 2020
Health Grades for Hospitals and Physicians
Leapfrog
Evidence-Based Practice
Health care knowledge continues to expand
Requires practice guidelines and assures that measures of
quality on which they are based are continually updated
Helps develop health care quality
Improving Quality through Health Professions Education
Improving quality requires:
Retooling health care workforce
Providing requisite skills to work in redesigned health care
systems
Redesigning health professions curriculum to transfer
current skills and knowledge
Health Professions Curriculum
Includes knowledge about patient-centered care
Demonstrates teamwork
Has emphasis on evidence-based practice
Demonstrates ability to measure quality of care
Includes health information technology

Chapter 3
Organizational Behavior and Magnet Hospitals
Objectives
Upon completion of this chapter, the reader should be able to:
Relate organizational behavior
Identify the evolution of organizational behavior and its
impact on autocratic, custodial, supportive, and collegial
organizational behavior
Identify the characteristics of a high-performance
organization
Upon completion of this chapter, the reader should be able to:
Identify the organizational characteristics that define
magnet nursing services
Relate the historical evolution and significance of magnet
hospitals
Support the 14 Forces of Magnetism
Describe elements of the Magnet Model
Organizational Behavior
Study of human behavior in organizations
Concerned with work-related behavior
Addresses individuals and groups, interpersonal processes, and
organizational dynamics and systems
Organizations
Coordinated and deliberately structured social entity that
consists of two or more individuals, functioning on relatively
continuous basis, to achieve predetermined set of goals
Exist as open systems
Must respond to changes in environment either from external
sources or stakeholders
Importance of Organization Behavior
Helps individuals become more effective employees
Those employees with high levels of organization behavior have
higher commitment to organization
More likely to stay employed
Organizational behavior allows individuals to increase
organizational effectiveness to meet needs of organization, its
members, and society
Evolution of Organizational Behavior
 Began in late 1800s
Shifted from assembly line mentality to knowledge economy
Health care workers of today possess well-developed abilities
with value and portability
Todays work environment empowers workers
Emphasis in todays health care industry:
Global diversity
Technological intensity
Change as a constant
Superior quality and safety outcomes
Continuous learning
Process improvement
High-Performance Organizations
Bring out best in people and produce sustainable high
performance over time
Pay close attention to dynamics of workplace
Known for having high quality-of-work-environments
Environments in which quality of human experience meets
or surpasses employee expectations
Require commitment of both leaders and employees
Value people as human assets
Mobilize teams that build synergy
Successfully bring people and technology together
Thrive on learning
Are achievement-oriented
Magnet Hospitals
Health care organizations that have met rigorous nursing
excellence requirements of the American Nurses Credentialing
Center (ANCC)
Highest level of recognition
Designation involves voluntary credentialing process
Historical Overview
Studies began in 1982 to look at hospitals that successfully
attracted and retained nurses and who delivered high-quality
care
Designated magnet hospitals
In 1990, ANCC established to serve as credentialing body
Magnet Facilities
First magnet facility in 1994:
University of Washington Medical Center in Seattle
Hundreds of facilities currently hold Magnet distinction
Expanded to include acute care hospitals and long-term care
facilities
Goals of the Magnet Program
 Promote quality in milieu that supports professional nursing
practice
Identify excellence in delivery of nursing services to patients
Provide mechanism for dissemination of best practices in nursing
services
Characteristics of Magnet Nursing
High-quality patient care
Clinical autonomy and responsibility
Participatory decision making
Strong nurse leaders
Community involvement
Two-way communication with staff
Opportunity and encouragement of professional development
Effective use of staff resources
High levels of job satisfaction
Benefits of Magnet Designation
Improved quality patient outcomes
Increased patient satisfaction
Reduced patient morbidity and mortality
Enhanced organizational culture
Increased respect for nurses
Shared decision making
Improved nurse recruitment and retention
Nurses perceive autonomy and control over practice
Enhanced safety outcomes
Lower incidences of needle stick injuries and near misses
Enhanced competitive advantage
Public has higher level of confidence in facility
Essentials of Magnetism
Opportunities to work with other competent nurses
Good nurse-physician relationship
Nurse autonomy and accountability
Supportive nurse manager-supervisor
Control over nursing practice and practice environment
Support for education
Adequate nurse staffing
Concern for patient paramount
Forces of Magnetism
Quality nursing leadership
Organizational structure
Management style
Personnel policies and programs
Professional models of care
Quality of care
 Quality improvement
Consultation and resources
Autonomy
Community and hospital
Nurses as teachers
Image of nursing
Interdisciplinary relationships
Professional development
Magnet Appraisal Process
Addresses requirements, processes, and activities necessary to
achieve Magnet designation
Requires collecting detailed demographic information
Consists of four phases:
Application
Evaluation
Site visit
Award decision
Professional Nursing Practice
Quality of professional nursing practice crucial to attracting and
retaining professional nurses
Nurse leaders play key role in creating supportive practice
environments
Magnet hospitals are one example of collegial work environments
Investment in this environment results in organizational
effectiveness

Chapter 4
Basic Clinical Health Care Economics
Objectives
Upon completion of this chapter, the reader should be able to:
Analyze why health care must be managed as a business
Apply the cost equation to the mission statement of a
health care enterprise to discover why the enterprise may
be thriving
or struggling
Analyze the impact of health care reform legislation on the
health care industry, including insurance companies,
health care providers, and hospitals
Apply the break-even formula to compute a break-even
point for a piece of equipment your health care
organization is planning to purchase
Economics
Study of how scarce resources are allotted among possible uses
to make appropriate choices among increasingly scarce
resources
 Based on three premises:
Scarcity
Choice
Preference
Economics and Health Care
Health care does not fit well into traditional market economy
Health care environment is much more elastic with reference
to price than many other consumer goods
In health care environment, provider is not payer
Actual payer is third-party reimburser
Making economic decision skewed
Perspectives on Health Care
First hospitals to care for sick and injured were charitable
institutions
Prior to 1980s, practitioner determined what health was needed
independent of patient or other colleagues
Cost of health care not questioned until 1960s
Medicare and Medicaid established in 1965
Health Care as a Business
Nurses have begun to recognize that cost of providing care in
traditional altruistic way is prohibitive
New payment regulations established in 1982 to pay flat fee for
service
Now known as prospective payment system
Consumers Need For Health Care
Attention has shifted toward safety and quality and need for
measureable outcomes
Total quality improvement (TQI) and continuous quality
improvement (CQI) have been initiated to assure cost
containment
Consumers are more empowered to better understand their
health care
Managed Care
Health care reform began with onset of Medicare and Medicaid
HMOs began in attempt to provide cost-efficient and quality care
For-profit brokerage business
Have resulted in complex structures and processes to
deliver health
Models of Managed Care
PPO
Contracts with practitioners and hospitals to provide health
services
Rates negotiated
Nongovernment health insurance
Predominately accessed through employers
 Largely HMO
Managed Care
Health care decisions driven by care options for which insurance
coverage will pay
Plans have been adapted to permit those who can afford to pay
higher premiums and copayments to have broader choices of
health care
Federal government pays largest proportion of all health care
costs
Health Care Improvement
Institute for Healthcare Improvement (IHI)
Not-for-profit organization created to help reduce morbidity
and mortality
Institute for Healthcare Improvement (IHI)
Developed care interventions designed to save 100,000
lives
Prevent central line, surgical site, and ventilator-
associated infections
Deploy rapid response teams
Prevent adverse drug reactions
Improve care of patients with myocardial infarctions
Future Perspectives
Highly complex and expensive technology continues to develop
Diseases that require expensive or long-term treatment continue
to emerge
Populations are living longer
Debilitating diseases occur with aging
Many questions need to be answered about health care for the
future
Money = Mission
Mission statement of any health care business describes purpose
for business
Vision statement establishes long-range goals for business or
unit
Strategic plan identifies how business or unit will achieve vision
and get goals developed
Business Profit
Revenue (income) minus cost (expense) equals profit
All businesses must make profit to stay in business
For-profit businesses distribute portion of profits back to
shareholders
Not-for-profit businesses feed profits back into business for
maintenance and growth
Not-for-profit organizations refer to profit as contribution to
margin
 Mission and margin strategically and operationally linked
Need to secure 4 percent to 5 percent of total budget as profit or
margin
Without margin, there would be no money to replace worn
out equipment, establish new services, improve salaries, or
build new buildings
Fundamental Costs
Direct costs
Related directly to managers unit
Includes nurse salaries and patient care supplies
Indirect costs
Not directly related to managers unit
Includes electricity, heat, air conditioning, and facility
maintenance
Fixed costs
Exist regardless of number of patients for whom care is
provided
Includes mortgages and salaried employees wages
Variable costs
Vary with volume
Includes amount of laundry used for number of patients
cared for and costs of medical supplies
Cost Analysis
Budget
Plan that provides formal quantitative expression to
acquiring and distributing funds
Generally based on spending from previous years
Cost predictions
Tools for developing a budget
Includes high-low cost estimation, regression analysis, and
break-even analysis
High-Low Cost Estimation
Examines both fixed and variable costs for previous five years of
each category of expenses
Both fixed and variable cost information needs to be adjusted
upward to account for inflation and anticipated wage increases
Regression Analysis
Examines all available past cost information over specific time
frame
Assumes only one dependent variable (cost) and only one
independent variable (volume)
Break-Even Analysis
Tool to determine volume of services that must be provided for
cost of providing services
Cost of provision must be equal to payment received
 Yielding neither profit nor loss
Diagnostic, Therapeutic, and Information Technology Costs
Most expensive payroll item:
Nursing salary
Most expensive operating budget items:
Diagnostic, therapeutic, and information technology
Most expensive operating budget items:
Certificate of Needs (CON) enacted to ensure equitable
distribution of monies to health care organizations
Not successful
Managed care programs oversee use of complex,
expensive technology by requiring justification
Nursing Cost
Nursing
Viewed as cost center that does not generate revenue
Cannot be accurate view of cost because nursing care varies in
intensity, depth, and breadth
Access to nursing care is important reason for hospitalization
Hospitalization generates revenue
Patient Classification System (PCS)
Tool used to identify nursing costs
Distinguishes patients on acuity and functional ability
Nursing care hours assigned based on these categories and
consider admissions, deaths, and discharges
Also includes considerations for psychosocial, education,
family, and bereavement issues
Relative Value Unit (RVU)
Index number assigned to various health services based on
relative amount of resources (labor and capital) used to produce
services
Used to calculate relative cost of providing nursing care based on
patient acuity levels
Quality Measurement
Four core components used to measure balance between
economy and care:
Establishment of best practices
Processes to provide best practices
Community outreach
Performance measurement
Quality and costs inextricably linked
Tool to measure cost containment and manage costs
Customer Satisfaction
Customer perception critical to amount of services organization
provides
 Commercial surveys measure how satisfied patients are with the
following:
Care
Food
Physical environment
Emotional ambiance
Interactions with health care workers
Comparison rankings provided across similar organizations and
populations nationally
Health Care Site Economics
Study of economics focuses on how choices are made to
overcome scarcity of resources
Involves three Rs:
Redesigning
Restructuring
Reengineering
Health Care Provider Economics
Both individuals and organizations bear economic risk
Dumbing down occurs when cost saving strategies include
using individuals with less knowledge to perform health care
services generally provided by people with advanced knowledge
Causes increased risk if not adhering to state practice acts

Chapter 5
Evidence-Based Health Care
Objectives
Upon completion of this chapter, the reader should be able to:
Discuss the history of evidence-based practice (EBP) in
nursing
Develop an understanding of evidence and its use in
decision making
Upon completion of this chapter, the reader should be able to:
Assume responsibility for developing an evidence-based
approach to patient care
Understand terminology used to describe types of evidence
and evidence-based care processes
Upon completion of this chapter, the reader should be able to:
Develop an informed view of the current state of evidence-
based care and an understanding of the role of nursing in
evidence-based decision making
Upon completion of this chapter, the reader should be able to:
Apply the steps needed to incorporate evidence-based care
in practice
Conduct a search for evidence on a given topic, using the
PICO method
History of EBP
Term coined in Canada during 1980s
Developed as means to integrate individual clinical medical
experience with external clinical evidence using systematic
research approach
Has become important because increasing technology has led to
improvements in ability to access information
Importance of EBP
Process approach to collecting, reviewing, interpreting, critiquing,
and evaluating research and other relevant literature for direct
application to patient care
Integrates both clinician-observed evidence and research-
directed evidence
Applying best available evidence improves patient outcomes
Nursing and EBP
AHRQ has provided stimulus for EBP movement
Needs exist to:
Define meaning of evidence in health care organizations
Use term evidence in daily practice
EBP Issues and Trends
Need for implementation of research to improve effectiveness
and efficiency
Growth of advanced nurse practice roles
Increased experience
in clinical pathways, standards, protocols, and algorithms
Need for outcome data
Explosion in technology
Need for collaboration
Types of Evidence
Published research
Published quality improvement report
Published meta-analysis
Policies, procedures, and protocols
Published guidelines
Conference proceedings, abstracts, and presentations
Outcomes From Integrating EBP
To organizations:
Improved recruitment of nurses
Improved retention of nurses
Improved employee satisfaction
Higher percentage of nurses pursing or attaining advanced
degrees in nursing
To patients:
Reduced length of stay
Reduced admissions
 Reduced mortality and morbidity
Improved satisfaction
Promoting EBP
Clinicians, nursing leaders, and nursing managers must promote
EBP to develop best practices at all levels
Research can be facilitated within health care institution
Findings can be reviewed and implemented
Changes in practice can be facilitated through collaboration with
nursing and medicine

Chapter 6
Nursing and Health Care Informatics
Objectives
Upon completion of this chapter, the reader should be able to:
List the components that define a nursing specialty and
discuss how nursing informatics meets these requirements
Relate educational opportunities for nurses interested in
pursuing a career in nursing informatics
Upon completion of this chapter, the reader should be able to:
Identify current challenges for health information
technology applications
Relate how ubiquitous computing and virtual reality have
the potential to influence nursing education and practice
Upon completion of this chapter, the reader should be able to:
Use established criteria to evaluate the content of health-
related sites found on the Internet
Identify the role of informatics in evidence-based practice
(EBP) and patient safety
Computers and Change
Computers and the Internet have changed how we communicate,
obtain information, work, entertain, and make important health
decisions
Have impacted nursing practice in how we learn material,
keep data for research, and manage budgets for nursing
units
Nursing Informatics
Integration of nursing, its information, and information
management with information processing and communication
technology to support health of people worldwide
Designed to analyze, formalize, and model nursing information
processing and nursing knowledge for all nursing practice
E-Health and Telehealth
E-health
Health services and information delivered or enhanced
through the Internet and related technologies
 Telehealth
Delivery of health-related services and information via
telecommunication technologies
Elements of Nursing Informatics
Computerized order entry
Electronic health records (EHR)
Patient decision support tools
Diagnostic results
Electronic prescribing
Including barcoding
Community health management
Communication and staffing
Evidence-based knowledge
Quality improvement
Documentation and monitoring
Need for Nursing Informatics
Development of standards for EHR on national health care
agenda
Important so practicing clinicians, pharmacies, and
hospitals can share patient information
The Joint Commission has highlighted need for increased patient
technology and nursing informatics
Interested Parties
The Leapfrog Group
Also advocating for increased technology
Encourages transparency and easy access to health care
information
National Quality Forum
National organization created to develop and implement
health care quality measurements and reporting
Nursing Informatics Specialty
Nursing Informatics (NI) recognized as specialty in 1992 due to
differentiated practice, defined research program, organizational
representation, educational programs, credentialing, and
application of principles
American Nurses Association (ANA)
Nursing Informatics: Practice Scope and Standards of
Practice
Informatics Education
Formal education programs:
Masters and doctoral degrees
Postgraduate certificates in Nursing Informatics
Multiple conferences nationally provide educational opportunities
and networking
 Several nursing and health informatics scholarly journals
available
Career Opportunities
Career opportunities growing exponentially
Changes in health care delivery have caused shifts in computer
systems to care management, clinical systems, clinical data
repositories, care mapping, and outcomes measurement
Many career opportunities in Nursing Informatics integrate with
IT departments
Information Systems
Have far-ranging capabilities
Function as mechanisms to improve outcomes, reduce errors,
control costs, and support move to EHR
Systems can be patient-focused (documentation, order entry,
care planning) or department-focused (laboratory, pharmacy,
billing)
EHR
Virtual way to maintain persons health data across lifetime
Must be able to be distributed over different systems to different
locations
Nurses and health care providers must be able to access
data
Patients confidentiality must be maintained
Information Processing
Computer functions provide for retrieval and processing of data
Includes decision support
e.g., alerts, alarms for drug allergies, abnormal
laboratory results
May provide consensus-driven and evidence-driven treatment
guidelines and protocols
Information Communication
Interoperability of systems and linkages to be able to exchange
data across disparate systems
Identifier numbers for health care systems essential
Infrastructures must be in place so standard data communication
can occur
Patient privacy must be maintained
Security Functions
Address confidentiality of private health information and integrity
of data being sent and received
Must be designed to ensure compliance with all applicable laws,
regulations, and standards
Must ensure only authorized people can access records
Security
Privacy
 Rights of individual to keep information about themselves
from being disclosed to anyone
Confidentiality
Act of limiting disclosure of private matters
Security
Means to control access and protect information
Information Presentation
Information must be available for nurses and health care works
to access in form that can be used for their individual needs
Data can be presented in detail or summary form
Interface
Ongoing technology development making integrated electronic
system realistic
Nurses use more interaction within departments than any other
group in hospital
Process model of nursing will work well and provide familiar
framework as systems continue to change and interface
Virtual Reality
Has allowed practitioners to develop minimally invasive surgical
techniques and use of robotic surgery
Has allowed students to visualize in 3-D images and understand
principles
Clinical Practice and the Internet
Important to use the Internet effectively and to be able to search
quickly
Strategies for efficient use and search:
Use websites published by government or professional
organizations
Use reputable health care organizations websites
Strategies for efficient use and search:
Use consumer sites organized by medical librarians
Use precise terms
Draw on search engines
Refine Internet searches with filters
Patient Resources
Health care providers need to evaluate accuracy or information
before providing it to patients
Nonclinicians need way to judge quality and relevance of
information provided on the Internet
Health care providers need to assist patients in determining
accurate information

Chapter 7
Population Based Health Care Practice
Objectives
 Upon completion of this chapter, the reader should be able to:
Discuss the social mandate to provide population-based
health care at the global, national, state, and local levels
Describe how population-based nursing is practiced within
the community and the health care system
Upon completion of this chapter, the reader should be able to:
Identify vulnerable and high-risk population groups for
whom specific health promotion and disease-prevention
services are indicated
Outline a multidisciplinary population-based planning and
evaluation process that includes partnerships with the
community and health care consumers
Upon completion of this chapter, the reader should be able to:
Discuss the nurses role in disaster preparedness and
response
Population-Based Health Care
Began with Florence Nightingale
Health care directed at population groups at greatest risk for
decrease in health status
Takes into consideration socioeconomic factors that
influence affordable, quality health care
Requires active partnership between providers and recipients of
care
Population-Based Health Care Practice
Development, provision, and evaluation of multidisciplinary
health care services to population groups experiencing
increasing health risks or disparities, in partnership with health
care consumers and community, to improve health of community
and its diverse population groups
Vulnerable groups:
Powerless, marginalized, or disenfranchised
Health Risk Factors
Variables that increase or decrease probability of illness or death
May be modifiable or non-modifiable
Modifiable factors can be changed
e.g., stopping smoking, losing weight
Non-modifiable factors cannot be changed
e.g., age, sex, race
Health Determinants
Variables including biological, psychosocial, environmental
(physical and social), and health systems factors or etiologies
that may cause changes in health status
May be assets or risks
Assets
 Positive factors that assist individuals/families to be
well
Risks
Risk factors that have negative impact on health
Health Disparities
Differences in health care system access and quality of care for
different racial, ethnic, and socioeconomic population groups
that persist across settings, clinical areas, age, gender,
geography, and health needs and disabilities
Result in poorer health outcomes
Differences in health care system access and quality of care for
different racial, ethnic, and socioeconomic population groups
that persist across settings, clinical areas, age, gender,
geography, and health needs and disabilities
Includes morbidity (illness) rates, mortality (death) rates,
and measures of quality
Population-Based Health Care Goals
Improve access to health care services
Reduce health disparities among different population groups
Reduce health care delivery costs
Providing Population-Based Care
Interventions for population-based care are provided on three
levels:
Individuals, families, and groups
Systems within community
e.g., health care systems
Community systems
Outcomes of these interventions measured in three domains:
Population health status
Quality of life
Functional health status
Definitions
Health status
Level of health of individual, family, group, population, or
community
Sum of existing health risk factors, level of wellness,
existing diseases, functional health status, and quality of
life
Quality of life
Level of satisfaction one has with actual conditions of ones
life
Health-related quality of life
Ones level of satisfaction with those aspects of life that
are influenced by ones health status
Functional health status
 Ability to care for oneself and meet human needs
Includes activities of daily living
Vulnerable population groups
People or groups of people underserved due to decreased
health status and increased mortality and morbidity
May be marginalized
May be disenfranchised
Culturally Inclusive Health Care
Hispanic, Asian, and African-American populations continue to
grow faster than White population
Nurses experiencing more diversity in workplace
Need to understand culturally diverse care and be more
culturally inclusive in nursing care
Absolute rate of health status disparities has decreased in last
decade
But rates have remained the same
Causes of Health Care Disparities
Inadequate housing
Unsafe neighborhoods
Lack of employment
Lack of educational opportunities
Inadequacy of health care
Lack of health insurance
Less access to primary care providers
Healthy People 2020
Statement of nations values and willingness and ability to secure
better health and well-being for all
Covers four broad areas of health concerns:
Population groups over lifespan
Health behaviors, lifestyle, and health determinants
Health-related infrastructure
Health conditions and chronic disease
Healthy People 2020 Mission
Identify nationwide health improvement priorities
Increase public awareness about determinants of health, disease,
and disability
Provide measureable objectives and goals
Strengthen policies and improve evidence-based practices
Identify critical research, evaluation, and data collection methods
Health Determinant Models
Holistic
Reflect multiple causes of health disparities in diverse population
groups
System approach to organizing health determinants that reviews:
Behavior and biology of individual/population group
 System approach to organizing health determinants that reviews:
Social and physical environment of population group
Health policies and interventions by government and
private organizations
Access to quality care
Population-Based Nursing Practice
Practice of nursing in which focus of care is to improve health
status of vulnerable or
at-risk population groups within community by employing health
promotion and disease prevention interventions across health
continuum
Holistic in nature
Seeks to empower population groups by enhancing protective
factors and resiliency
Population-Based Nursing Interventions
Begins with community assessment
Has three levels of practice:
Community
Norms, attitudes, practices, and behaviors
Systems within community
Laws, power structures, policies, and organizations
Individuals, families, and groups
Knowledge, attitude, beliefs, practices, and behaviors
Models of Population-Based Care
Traditional models
Start with public health and community health agencies
working in partnership to carry out community assessment
Priorities identified and plan developed and implemented
Evaluation conducted after plan implemented
Nontraditional models
Begin with assessment of specific population groups that
have complex health problems
Nursing Process
Assessment may focus on total health resources and needs of
community or may be limited to one population group or health
concern
Community must be equal partner in process
Goal setting and implementation should be culturally and
developmentally specific to population groups served
Community members should be involved
Evaluation methods and measurements need to be developed or
selected during planning process
Evaluation
Outcomes should focus on health status, functional ability, and
quality of life of at-risk population groups
 Involves multidisciplinary team, health consumers, and
community partnerships
After evaluation completed, unmet needs of population groups
determined
Program Evaluation
Access
Was service offered to all in community?
Quality
Did services meet unmet health needs?
Did health status improve?
Cost
Were services affordable?
Did program stay within budget?
Equity
Did services meet priority health needs of most
underserved?