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What Do Hospital Boards Do?

A hospital board ensures that a hospital reaches its goals, retains its values and remains financially solvent. The board — commonly called “hospital governance” — provides a significant amount of leadership in healthcare facilities. Since their policies may affect clinical staff, boards are increasingly seeking nurse members for more balanced input. Nurses who have completed a Master of Science in Nursing Administration (MSN) program may ideal for this role.

What do hospital boards do?

Board Roles and Responsibilities

While they typically work behind the scenes, boards make decisions and establish policies that affect virtually everyone in a hospital. Traditionally, their largest responsibility has been to oversee financial performance. For example, they may establish short- and long-term organizational budgets, including wage guidelines, for each position. They may also monitor investments, debt loads and capital expenditures such as expensive equipment. The board may track endowments and disbursements for the hospital foundation as well.

Management is another key responsibility of hospital boards. The Chief Executive Officer (CEO) reports directly to the board, which acts as the supervising body. The board may issue directives or reprimands as necessary so that CEOs perform their jobs as expected. When a CEO position becomes vacant, the board hires a replacement. They interview candidates, and they determine the responsibilities and salary for the position.

Boards spend a lot of time developing strategies that foster growth and meet the needs of the surrounding community. They ensure these strategies align with the hospital’s overall mission, values and vision. As part of their mission, hospitals often assume a community leadership role in healthcare outreach and education programs. To carry out these initiatives, boards may suggest participation in health fairs and community clinics. Other strategic decisions may modify the marketing message or introduce staffing changes to accommodate patient loads.

Boards are also instrumental in evaluating how a hospital merger, acquisition or partnership will affect their facilities and overall profitability. These decisions are becoming more commonplace — mergers, acquisitions and partnerships grew nearly 70 percent from 2010 to 2015 — as hospitals find that strategic partnerships may improve their ability to provide cost-effective patient care on a larger scale.

Board Membership

For a hospital board to be effective, it should include a variety of professionals who closely mirror the makeup of the facility’s employees. This creates better representation of the hospital’s work force. Traditionally, boards include mainly high-level hospital executives, like the CEO and the chief financial officer (CFO) as well as others with a strong financial background. Physicians fill one-fifth of the seats on the average hospital board. Other clinical staff, though, like nurses, have gone largely underrepresented. Only 6 percent of boards included nurses in 2011; only 5 percent did so in 2014.

As quality metrics become more important criteria for insurance reimbursement, nurse managers who have completed a MSN in Nursing Administration program may find hospital boards seeking their input regarding clinical matters. Since the board makes decisions that may directly or indirectly affect nurses, nurse managers can represent the views, needs and opinions of the facility’s nursing staff.

Behind the Scenes

Hospital boards work behind the scenes to ensure that hospitals stay financially solvent and meet the needs of the communities they serve. They provide leadership in healthcare organizations, overseeing strategic growth and developing policies and procedures to reach their goals.

Learn about the University of Texas at Arlington online Master of Science in Nursing in Nursing Administration program.


2014 National Health Care Governance Survey. (2014). American Hospital Association

Hospital Merger and Acquisition Activity Up Sharply in 2015, According to Kaufman Hall Analysis. (n.d.). Kaufman Hall

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