The Chief Diversity Officer role is described as one of the most challenging positions in business for several reasons, and there is an added layer of complexity for those who sit within the healthcare sector. To ensure the best service for our healthcare members in solving for their unique challenges, Seramount researchers set out on a listening tour during which we conducted in-depth interviews with 30+ DEI leaders at health systems, health plans, and other health care providers. Interviews were conducted in July–December 2022 and participants were asked two main overarching questions: “What are your biggest challenges?” and “Which are unique to health care?”
Here are the findings derived from the candid reflections and insights shared by leading health system CDOs on the current state of their DEI efforts:
1. The Byzantine Nature of Health System Organizations, Coupled with Chronic Margin Pressures, Magnifies the CDO’s Change Management Challenges
Health systems are the most complex and dynamic organizations in the economy, and this creates unique challenges for CDOs. There are many stakeholders and layers to consider including community hospitals, outpatient, home health, physicians, health plans, and AMCs. More than 36,000 physician practices were acquired by health systems between 2019 and 2021, and the average annual health system merger and acquisition transactions made between 2015-2020 was about 100. This coupled with the fact that margins have been rapidly declining poses significant challenges to CDOs trying to move the needle.
2. They are Struggling with Diverse Representation in Clinical and Technical Roles Where Credentials Matter
Health systems can point to racial/ethnic diversity in many frontline roles, but as one begins to investigate roles where credentials matter more, representation tapers off. Having a leadership team that reflects the diversity of patients remains a distant goal for most systems, many of which lag the rest of corporate America in adopting “foundational” DEI practices. Health system boards and C-suites are still largely white, Black managers and executives report seeing bias in promotions, and few report access to mentoring and sponsorship programs.
3. Frontline Staff Are Turning Over at Historic Levels, With No End to Chronic Staffing Shortages in Sight
Healthcare workers are at their breaking point. Frontline staff are burned out and it feels nearly impossible to ask them to do even one more thing. Nursing vacancy and turnover rates are both increasing, and one-third of RNs are thinking about leaving their current role, most planning to leave direct patient care completely. According to McKinsey, “By 2025, we estimate the United States may have a gap of between 200,000 and 450,000 nurses available for direct patient care, equating to a 10 to 20 percent gap. To meet this demand, the United States would need to more than double the number of new graduates entering and staying in the nursing workforce every year for the next three years straight.”
4. Health System CDOs Report Having to “Take It Slow,” Struggling to Shape the Narrative in the Face of Community Skepticism, State Law, and (at Times) Outright Hostility
CDOs around the country are faced with overly racist attitudes and hostility, local and state-level resistance to DEI initiatives, and challenges with recruiting diverse staff. One CDO shared, “We’ve made it clear to staff they need to treat every patient, but our state passed a law allowing any provider to refuse to treat a trans patient. It would allow an employee to sue us if we forced them to treat that patient.”
5. To Health Systems CDOs, Workforce DEI Often Seems Like a Side-of-Desk Job
Many health system CDOs are tasked with “overseeing” efforts to ensure delivery of culturally competent patient care and advance health equity in the broader community. They need to pay attention to workforce DEI, inclusive patient care, health equity and access, and community building. And the median health system DEI team is only three to five full-time employees.
6. Still Struggling to Make the Business Case for Health Equity
Only 25% of health system executives say that meeting market expectations is a top goal of their health equity initiatives and 26% say improving financial performance is a top goal. Chief Diversity Officers are asking themselves, “How do we convince leadership that delivering culturally competent care and reaching out to populations we’ve historically ignored is good for business?” Racial minority patients are less likely to report being treated as unique individuals than their white counterparts. But these same populations are increasingly likely to be commercially insured. One CDO shared, “We’re leveraging multicultural marketing to change the payer mix and get more diverse patients at the same time. When I go before our diversity council, I can show them ROI from our investments; that gets the CFO’s ear—you’re speaking his language.”
Our DEI Research Partnership is a comprehensive tool to help your organization enact meaningful top-to-bottom DEI change. Please contact me at [email protected] to learn more about how you can lend your experience and guidance to the conversation. We’d love to hear your perspective and to share more takeaways that we’ve gathered from these interviews.