4 key themes for leaders in the ‘big beautiful bill’ era
While the healthcare implications of the Trump Administration’s "big beautiful bill” will take several years to play out, it is already clear that four themes will be central to the work of healthcare leaders: uncertainty, complexity, strategy, and social capital. The first two characterize the challenges that leaders will face; the second two will be essential to their response.
The cumulative challenges of limited funding and meeting patients’ needs are fueling uncertainty and complexity. Reduced healthcare spending, higher uninsured rates, and stagnant payment growth are all likely outcomes. Finding enough employees to meet the growing needs of the public is already a problem without a solution—and projected to get worse. And morale and trust are declining among patients and employees.
Each of these challenges demands focused attention, but so does their aggregated impact on organizations and their leaders. Uncertainty requires leaders to do much more than manage operational effectiveness (i.e., doing what the organization already does better). This work (improving efficiency and reducing errors of all types) is critical to organizational survival, and can even allow organizations to thrive in eras of relative stability. But when the unexpected arises—e.g., major funding cuts, pandemics, climate-related disasters—tight management of business-as-usual processes won’t suffice.
Similarly, tight process management has limited effectiveness when challenges are complex, as opposed to complicated. Complicated challenges require many people to do many things (e.g., performing a medical procedure). Complex challenges, on the other hand, are created by multiple factors interacting in unpredictable ways. Overcrowded facilities are a complex challenge. Falling levels of trust among patients or employees is too. And so is the challenge of meeting a population’s growing needs with resources that remain static or even falling.
To address challenges characterized by uncertainty and complexity, leaders need strategy and social capital. In combination, strategy and social capital give organizations resilience and flexibility. They need that resilience and flexibility to deal with the unexpected and with the complex.
If operational effectiveness is doing a better job of what one currently does, strategy means making choices about what the organization is going to do—and not do. Choices are painful, and many healthcare leaders don’t like to make them. After all, choices can make some colleagues angry, and we in healthcare tend to be the types who are troubled when friends are furious.
But organizations that cannot make choices will have a hard time dealing with the uncertainty and complexity of the challenges ahead. It will not be possible to thrive by requiring every department to shave X percent of their costs this year, and another Y percent next year. Organizations will have to decide what they will stop doing, so they can do a great and efficient job on the core elements of their strategy.
As described by my colleague Michael Porter, those choices should be guided by two questions:
- What value are you creating for what customer? (In healthcare, how are you making life better for patients?)
- How are you going to be different?
If you are doing the same things, the same way as everyone else, you will inevitably find yourself in a price war and will be forced to reduce your costs to levels that threaten your ability to execute and thrive.
How to be different? The most sustainable way is building social capital—strengthening teamwork, creating a culture of respect, bringing high reliability to the challenge of reducing harm of all types (physical, emotional, economic, social). The work of building social capital was the focus of the book I wrote in 2024, which was published in February this year. Since finishing that manuscript last summer, I’ve learned a lot through interactions with organizations around the country and beyond. An example: Teams with strong social capital—that is, where people trust each other and rise to the occasion as a group—address complex problems more effectively than teams in which everyone is simply practicing at the top of their license.
If there’s one thing we can count on in the years ahead, it’s that uncertainty and complexity will only deepen. But so will the insight and innovation that healthcare leaders bring to meet them. At Press Ganey, we’re committed to helping turn those insights into action and building the trust and strategy needed to lead through whatever comes next.