Decentralized hospital management: rationale, potential, and two case examples

Sunnybrook Medical Centre (SMC) in Toronto designed a unique organizational model for managing hospital services and programs in three clinical units. The SMC model, like a similar model at The Johns Hopkins Hospital (JHH), emphasizes the active participation of physicians in management, the decentralization of budgetary control, and accountability for resource use to the clinical unit level. Expanding on the JHH model, SMC implemented additional financial incentives to encourage changes in clinical practice which would bring direct financial benefit to the respective clinical unit, and thereby to the medical center. To improve quality of service, SMC has also expanded the JHH model of multidisciplinary and participatory approaches to patient care by standardizing managerial roles and responsibilities of each member of the management team. A brief description of issues related to implementation of these unique models summarizes the program's success.