Mismanaging your hospital can end up closing the business

The first article of 2026 is finally published. First of all, let me wish you all a Happy New Year and may 2026 bring us all goodness and compassion. Let’s stay optimistic and positive in pursuing our dreams. This article discusses the other side of hospital management weaknesses in general that can lead to a decline in overall hospital performance. I have encountered many of these while assisting hospital management through restructuring and purchase process.

In my ‘independently self-work’ time for the last 3 years, as a hospital management advisor, I frequently dealt with privately-owned healthcare facilities. Clinics and hospitals that are owned by family typically have a management problem that ends up needing to close down. And usually the mismanagement starts with the owner itself, not the employees. Does it sound familiar to you? Let’s walk with me, and I’ll tell you about the cases that I stumbled upon.

The first thing that they will ask for your help is because their financial report is on fire. Not enough on revenue, while the expenses are coming out with a heavy flow just like a waterfall. A few cases that I found while reading their financial report, are usually as follows:

1. Mismanaging BPJS Kesehatan patients. This is actually happened years ago, but somehow it still appears. Lately, I heard from fellow hospital management that BPJS didn’t pay their claims due to coding mistake, doctors who gives treatment and medication that aren’t approved by BPJS even though they’re in line with the disease’s clinical pathway. While this may seem like an old case, I can’t just dismiss it, as it’s still happening in some hospitals. So, I should include this in my findings.    
2. Treating the hospital as your cash cow. This condition is typically a hospital run by a family. They didn’t make room for the company to grow; Every month the profits would be divided among family members. So, whenever there is a need for renovations or developing a new facility or opening a new branch, or even training for management / medical staff, they don’t have the money. Hence, the old building started to falling apart here and there. The employees’ performance does not improve, resulting in poor service and before you know it.. no one wanted to go there for treatment.
3. One man show. The owner also acts as anchor doctor who brings the majority number of patients. Acting as the star of the small hospital, and not garnering other doctors to be his/her successor can give you disadvantages. When this anchor doctor suddenly cannot practise anymore because of a certain condition, then we can all predict the hospital losing its majority number of patients. Other doctors don’t get acknowledged of their skills by the patients for all this time. Management also didn’t promote other doctors when they still have lots of patients.

From the findings I encountered in the field when studying at each hospital, there are several points that I can conclude. What I’ve learned from those healthcare facilities are:

1. In today’s era, the issue in business in general, particularly in hospitals, has shifted from mismanagement to capital. When a hospital faces a financial crisis, particularly a cash flow crisis due to management issues, the primary focus should be on seeking capital, not improving management. Problematic conditions on the field can threaten operational cessation. With capital assistance, the business can be helped to continue operations, and only then can management be improved.
2. Leave it to the experts. Having enough money alone or being a physician with many patients doesn’t make you capable of running a hospital. Don’t take ‘MANAGEMENT’ for granted. As easy as you think ‘management’ would be, it is NOT. Don’t mix medical practitioners with managing a business. It won’t mix, just like water and oil. There is a reason why ‘Management’ is a major in the field of economics, not medicine.  
3. Even though a hospital is a business that you need to make a profit out of it, do not forget there is a humanity factor at the TOP of every decision-making related to service delivery. Combine it with good hospitality, your service will get a good 5 stars in the review. From a review?? YES. Nowadays, you will be surprised that many people choose a hospital based on digital reviews, not because of credibility.     
4. Use a good Hospital Information Management System (HIMS or SIMRS) from appointment, schedules, administration, finance, laboratory, pharmacy, eMedical records, until the back office is necessary. Anytime a director of the hospital wants to know its current situation or condition, he/she can access the system in real-time. The managers can also easily pull the data according to their department for making a report. A good HIMS from beginning-to-end is easier for Director or owner to control operational flows, and definitely this can prevent corruption within the unit.

I certainly hope that you didn’t experience what I’m sharing in this article, or perhaps have a different situation in your hospital? Please share in the comment column, no need to name names, just the situation. I think, other readers and I, would be happy to learn from others’ experience of mismanagement. We all want to be better, don’t we?