Case nine. Two hospitals struggling to survive in a small rural community.

Abstract

St. Luke's Hospital was the only hospital in town until 26 years before the time of the case. In the late 1950s St. Luke's Hospital was overcrowded and in dire need of renovation and expansion. Plans were devised and the hospital applied for Hill-Burton money to expand. At the same time, a group of local citizens decided to also apply for Hill-Burton money to build another hospital, County Memorial, in the community. The Hill-Burton money was divided and both received money. Both facilities opened within months of each other. For about 10 to 12 years, both hospitals prospered. At the time of the case, competition has heated up between the two facilities. Attempts at collaboration fail; the story is one of wasted resources and community pain because of the lack of ability of two competitors to put aside differences for mutual benefit. The case ends with there being only one hospital in town. Read alone, the case is instructive in terms of the difficulties created when organizations value survival in a known form above all else. Read and considered in concert with Case Eight, it encourages contemplation of the pros and cons of head-on competition versus collaboration.