Health Care System "In Pursuit of Excellence" Case Example

Guthrie Health

February 2010

The Organization

Guthrie Health is a not-for-profit health care organization that provides a broad range of health care services to more than 23 communities in northern Pennsylvania and southern New York.  Headquartered in Sayre, Pennsylvania, the organization includes primary care and specialty physicians, community hospitals and a research institute, as well as home care and a long-term care facilities.  Guthrie Health was established in 2001 with a unique integration of the Guthrie Healthcare System and the Guthrie Clinic.

Guthrie Healthcare System is a community-based not-for-profit health care system that is the parent corporation of the Robert Packer Hospital, Troy Community Hospital, Corning Hospital, Guthrie Home Care, Guthrie Hospice, Sayre House Nursing Home, and the Guthrie Foundation.

Guthrie Clinic is a multi-specialty group practice of more than 229 physicians and 90 mid-level providers with a subspecialty and primary care network of sites in 23 communities and approximately onemillion annual outpatient visits.
Forty-two hundred (4,200) employees work to carry out Guthrie Health’s mission to “work with the communities [they] serve to help each person attain optimal, life-long health and well-being, by providing integrated, clinically-advanced services that prevent, diagnose, and treat disease, within an environment of compassion, learning, and discovery.”
Dedicated to a vision that “customer experiences and advanced clinical services will be so exceptional that patients and referring physicians will always prefer to use Guthrie”, Guthrie Health and its hospital have been recognized by Thomson/Reuters (Solucient) 16 times since 2001 as Top 100 organizations.  These recognitions have included the receipt by Guthrie’s Robert Packer Hospital in 2009 of the new Thomson Everest Award, which was given to only 23 hospitals in the country.

Becoming a High Performing Organization

Guthrie Health’s achievement as a high performing organization did not begin as an “initiative” per se but evolved from a long tradition of excellence.  The Guthrie organization dates back to 1851 with the establishment of the Lehigh Railroad by Asa Packer in Pennsylvania.  In 1885, the mansion built by Packer’s son, Robert, was converted to the Robert Packer Hospital to meet the health care needs of hundreds of workers from the railroad yards and their families.
Trained by the Mayo brothers, Dr. Donald Guthrie was a founder and one of the 13 original members of the American Board of Surgery, becoming the surgeon-in-chief and administrator of the Robert Packer Hospital in 1910.  Dr. Guthrie established one of the first multi-specialty group practices in the United States and led the Clinic until 1956.

In 2001, the long-standing and highly-regarded clinic and health care system recognized they had an opportunity to serve the community more effectively in a joint effort that would unite the best of both organizations.  An integrated partnership, which could not easily be broken apart, was established.  Now focused on a single mission, Guthrie Health is built on a history of commitment to excellence with an academic and research orientation.

Structured for Partnership.  In bringing the two organizations together, Guthrie Health established a unique management structure with co-CEO leadership.  The implementation of a medical affairs co-CEO and an administrative affairs co-CEO truly integrates the clinic and the health system.  The success of this structure requires close teamwork between the two co-CEOs and requires them to maintain a joint focus on the greater mission of the organization as a whole in meeting the needs of their communities.

The “parent board” of Guthrie Health is equally unique.  Comprised of 14-members, 50 percent of the board’s members are physicians appointed by Guthrie Clinic. The other 50 percent of members are appointed by Guthrie Healthcare System.  The fact that there is not a 51 percent majority by either entity requires strong collaboration and mutual respect in decision-making and fosters a true sense of partnership.  That collaboration and partnership is considered essential to ensuring teamwork and alignment throughout the organization.  Potentially damaging issues of control have not occurred, sidestepped in part by a required two-thirds approval vote on key issues.

Key Factors to Achieving High Performance.  In July 2009, Guthrie was one of a number of organizations from 10 communities across the United States invited to Washington, DC, to participate in a national event, the purpose of which was to find and review models of success in American health care that provide low-cost, high-quality care.  Each of the communities represented had quality scores well above average, yet spent 16% less per Medicare patient than the national average.  Common among all ten high-performing communities was a focus on data and quality performance.  Physician leadership and organizational culture were also credited as critical factors to success.
Guthrie Health attributes much of its success in achieving high performance levels of quality and efficiency to a continuous, multi-year focus on key factors that include:

  • Culture
  • Organizational alignment
  • Leadership and management talent
  • Measurement and performance
  • Financial discipline

The Importance of Culture.  Guthrie’s quest to strengthen its culture began with several advantages.  Rooted in a 100 year-old group practice, Guthrie’s physician-led past has been one of exceptional physicians practicing in an environment of collaboration.  The organization’s rural location has also contributed to a culture of close relationships and loyalty between and within both organizations and the community.  Both the clinic and the health system have enjoyed strong reputations in the region over many years.

The integration of the two organizations provided a new vision of collaboration and partnership between the clinic and the health system.  Central to Guthrie’s efforts to develop a high performance culture is a clear, unwavering and intense focus on employee morale, patient satisfaction and quality performance.

Guthrie Health participates annually in the Morehead employee opinion survey, which provides leadership with objective measures of employee morale compared to other health care organizations across the country.  This information is used by every manager with direct reports to develop their annual “people” goals. Guthrie has identified from the survey its “power items,” those employee opinions or perceptions it believes are most critical to employee morale.  For Guthrie, developing strong employee morale translates into organizational success in achieving its purpose to make “a meaningful difference in the lives of the people [they] serve through excellence and compassion in health care.  Every person.  Every time.”  Power items include employee perceptions or opinions on statements like:

  • The person I report to treats me with respect
  • I like the work I do
  • My department works well together
  • The entity for which I work provides high-quality care and service

Responses to the power items are scored and provide a morale profile for each unit in the organization. The highest scores constitute a Tier 1 unit; mid-scores constitute Tier 2; and lower scores a Tier 3.  At Guthrie, dedication to employee morale does not stop with simple measurement.  The size of the management incentive pool is determined by success in achieving Morehead employee morale targets.  In addition, individual units receive incentive pay for achieving employee morale goals. 

With a culture focused on the value of employee morale to organizational success in the delivery of quality health care, Guthrie has flipped conventional thinking when it comes to bonus payment.  Instead of basing bonus payments on the achievement of specified financial margins, Guthrie bases bonus payments on the improvement in Morehead scores.

Since 2006, Guthrie has seen its Tier 1 scores increase from 24% to 53% of all management units, with a corresponding decline in Tier 3 scores from 44% to 19% of all management units.  In addition, they have improved their national health care average percentile ranking for employee morale from the 40th percentile in 2007 to the 86th percentile in 2009.

Combining strong employee morale with physician partnership has served to create a cultural alignment and sense of pride wherein everyone in the organization works to see Guthrie Health succeed.  Maintaining alignment requires time and constant attention.  With the knowledge that organizational pride cannot be forced, but must instead emanate from the grassroots, Guthrie leadership constantly strives to understand the perspectives of its front line workers.  All managers are expected to understand and focus on current environmental realities and the implications of those realities to related goals.

Aligning Organizational Thinking.  Organization alignment is defined at Guthrie as “integrating and connecting the vision, values, and goals of the organization into daily decisions and actions.”  Guthrie Health attributes a share of its performance success to a consistent, almost ten year, focus on the same five strategic pillars known by all employees throughout the organization: service, people, quality, growth and finance.  Annually, Guthrie employees develop eight to ten goals in support and advancement of performance within these pillar areas.  The goals for each manager:

  • Must represent every pillar as appropriate;
  • Should include an achievable stretch in performance; and
  • Should align with the organization (clinic or health system) and ultimately with Guthrie Health’s goals.

Other goal expectations that help ensure organizational alignment at Guthrie:

  • Weighting of pillar goals should be relatively equal;
  • Managers with direct reports must each have an employee satisfaction goal;
  • Individuals involved in patient care must have a patient satisfaction goal;
  • Individuals in areas of growth must submit a growth goal;
  • All areas must have a financial goal; and
  • All managers must have a quality goal.

The key is to hit the goal.  Partial credit for achievement is not awarded; the program is recognized as “an outcome-based program, not an effort-based system.”

Focus on Measurement and Performance.  Once established, goal achievement is not left to chance.  Enterprise-wide leadership meetings are held during which updates are provided, progress on management and performance targets is reviewed, and breakouts with feedback are conducted.  Goals are often achieved because of the clear focus and collaboration with managers across the organization.

Guthrie’s Infection Reduction Program illustrates how attention to goal achievement contributes to the organization’s success.  From January 2008 to July 2009, Robert Packer Hospital’s overall infection rate was driven down approximately 50 percent, and then sustained.  The ability to accomplish this significant decrease was attributed to well-defined, aligned goals and focused attention on implementation, measurement and performance.

Well-defined goals.  The leadership believes that the key to successful goal achievement is to find key “leverage goals” which, if accomplished, can lift the performance of the entire organization.  In recent years, reducing infection has been a good example of this approach. The organization took the following goal-related steps to achieve these goals:

  • Staff was aggressively educated that reducing infection was one of two key organizational initiatives;
  • Each hospital, department, and manager work unit was required to have one infection improvement goal; and
  • Each section was required to report their goal progress to the Performance Improvement Council quarterly.

The establishment of oversight and monitoring teams.  The Hospital Acquired Infection Reduction Team was established.  This team was accountable for the oversight of sub-groups, each of which was focused on the key infections to be reduced:

  • The Bloodstream Infection Team, which developed new policies and monitored compliance with treatment protocols;
  • The Ventilator Acquired Pneumonia Team, which implemented VAP IHI Bundles and monitored staff performance in bundle utilization;
  • The Contact Precaution Team, which implemented new policies, established new processes and improved awareness of protocols; and
  • The Foley Catheter UTI Reduction Team, which implemented new training guidelines and pilot program.

A Surgical Infection Reduction Team focused attention on improving performance on Medicare Core Measures related to pre-op prophylaxis of surgical patients through implementation of best practice guidelines.  Surgical Departments further implemented other infection reduction programs.

Strategic pillars, goals and leadership meetings are critical to aligning and strengthening the organization.  In addition, employee communication through the implementation of employee advisory groups, employee shadowing, “Ask the CEO” forums, and numerous celebrations all coalesce to contribute to the development of Guthrie Health as a high-performance organization.

Developing Leadership and Management Talent.  Guthrie expects high performance from everyone in the organization, which cannot be attained without the best leaders and managers.  Guthrie seeks out talent from within the organization, cultivating the development of new leaders through investment in training, 360-degree reviews and disciplined performance management.  A partnership with the master’s program at nearby Cornell University provides a pipeline of interns that helps feed the organization’s human resource needs.

Maintaining Financial Discipline.  Guthrie Health leadership maintains constant vigilance in the monitoring of the organization’s financial position and a rigorous discipline is exercised in the deployment of capital. As a not-for-profit organization, Guthrie Health must maintain a strong operating margin in order to finance the purchase of needed equipment and other resources required to successfully deliver high quality care.

To successfully navigate a tough economic environment and balance financial decisions with the needs of the communities it serves, the organization’s leadership has established a clear picture of what is core or vital to the organization’s ability to achieve its mission, and what is not.  They have applied similar strategic principles in their commitments to the communities they serve.  Not all services provided by the hospital are profitable, but many are vitally important to the community’s health and are maintained.  Guthrie has also worked on identifying and addressing the specific community needs, such as childhood obesity.

The disciplined financial approach that Guthrie Health has maintained has been recognized with an A+ bond rating from Standard and Poors and Fitch, difficult for any rural organization to achieve despite the tough economic times.


Guthrie Health did not undertake “an initiative” to become a high-performance organization or to achieve an award.  Instead it has tackled the more general, but perhaps more challenging, task of achieving and maintaining excellence in all of its five pillars of service, people, quality, growth and finance.  Guthrie’s leadership has focused their attention on strengthening a culture of excellence, aligning the organization’s thinking and goals, developing talent and maintaining financial discipline. 

In acknowledgment of its accomplishments, Guthrie Health and its hospitals have been recognized 16 times since 2001 by Thomson/Reuters (Solucient) as a Top 100 organization.  The awards include repeated recognition of the Robert Packer Hospital in the areas of cardiovascular, performance improvement leader hospital, Top 100 hospital, and Robert Packer has also been recognized as a Thomson Everest Award recipient.  Corning Hospital has also been recognized as a performance improvement leader hospital.  In making its determinations Thomson/Reuters measures the following key criteria to select the best hospital performers in the country:

  • Quality
    • Risk Adjusted Mortality Index
    • Risk Adjusted Complication Index
    • Risk Adjusted Patient Safety Index
    • Core Measure Performance
  • Efficiency
    • Severity Adjusted Average Length of Stay
    • Expense per adjusted Discharge, Case-mix and Wage-adjusted
    • Profitability
    • Cash to Total Debt Ratio
  • Patient Satisfaction
    • HCAHPS Score


In 2009, Thomson Reuter’s released the results of a study of 252 health systems that measured clinical quality and efficiency.  The study measured mortality, complications, patient safety, length of stay and use of evidence-based practices.  Guthrie Health was ranked as one of the 50 health systems comprising the top 20% of those studied.
Importantly, Guthrie Health’s high-performance efforts and outcomes are being recognized and studied as a critical model of quality and efficient health care for America.

Contact Name:  Mark Stensager
Title:  President & CEO, Guthrie Healthcare System; and
   Co-CEO, Administrative Affairs, Guthrie Health
Tel:  (570) 882-4312
Fax:  (570) 882-5152



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