The Anthropology of Organizations Under Regime Change

What Happens to the Humans When the Ground Shifts

The public finance foundations describe the regime change: the simultaneous dismantling of Medicaid entitlement and construction of RHTP capacity-building infrastructure. The organizational economics document describes the structural forces — resource dependence, isomorphism, institutional lag — that constrain organizational response. The workforce foundations describe the labor market dynamics that make staffing the transition difficult.

None of them describe what it is like to be inside the organization while it happens.

This is not a soft question. It is the question that determines whether the structural predictions hold. Institutional economics predicts inertia. Organizational ecology predicts selection (failure and replacement rather than adaptation). Resource dependence theory predicts constrained response. But these are probabilistic predictions about populations of organizations. Individual organizations are inhabited by specific people who interpret, respond, resist, accommodate, and sometimes transform the structures they inhabit. The anthropological question is: How do they do it, and what determines who succeeds?

This document draws on anthropological and sociological traditions that study human behavior within institutions under conditions of radical uncertainty — liminality, institutional thinking, bureaucratic indifference, sensemaking, and the social production of organizational identity — and applies them to the specific experience of healthcare organizations navigating the RHTP transition.

I. Liminality: The Threshold State

Turner’s Framework

Victor Turner’s concept of liminality (The Ritual Process: Structure and Anti-Structure, 1969), derived from Arnold van Gennep’s earlier work on rites of passage (Les rites de passage, 1909), describes the transitional state between two established social positions. In rites of passage, the initiate has left the old status (child) but has not yet arrived at the new one (adult). The liminal period is characterized by ambiguity, disorientation, the suspension of normal social structure, and — crucially — the potential for both transformation and danger.

Turner observed that liminal states are simultaneously creative and destructive. The suspension of normal structure permits experimentation, communitas (a sense of deep social bonding among those sharing the liminal experience), and the emergence of new social forms. But it also produces anxiety, identity confusion, and vulnerability to exploitation by those who control the transition process.

Organizations in Liminal Space

Healthcare organizations navigating the RHTP transition are in a liminal state. They have left the old regime (Medicaid-dependent, entitlement-supported, compliance-oriented-to-Medicaid-rules) but have not yet arrived at the new one (RHTP-funded, capacity-building, compliance-oriented-to-2-CFR-200, moving-toward-self-sufficiency). The transition period is characterized by:

Structural ambiguity. The organization must operate under two compliance frameworks simultaneously — the old Medicaid rules that still apply (Medicaid hasn’t disappeared, just contracted) and the new RHTP rules that are unfamiliar and still being interpreted. The staff must be bilingual in two regulatory languages, and the organization must maintain two sets of institutional competencies.

Identity confusion. What is this organization? Under the Medicaid model, the FQHC was a safety-net provider — its identity was rooted in serving the underserved, regardless of ability to pay. Under the RHTP model, it is being repositioned as a capacity-building enterprise — an organization that receives time-limited investment and is expected to become self-sustaining. These identities are not obviously compatible. The staff who joined because of the safety-net mission may not recognize or embrace the self-sufficiency mission. The organizational identity — the shared understanding of who we are and why we exist — is in flux.

Communitas and fragmentation. Turner predicted that liminal states can produce communitas — a powerful sense of solidarity among those sharing the experience. This is visible in some RHTP-navigating organizations: a “we’re all in this together” spirit that mobilizes collective effort and creative problem-solving. It is also visible that liminality can produce fragmentation: blame, anxiety, turf protection, and the retreat into established roles and routines as a defense against uncertainty. Whether the organization experiences communitas or fragmentation depends on leadership, trust, communication, and the organization’s prior history with change — all factors that structural analysis does not capture but ethnographic observation reveals.

Vulnerability to exploitation. Organizations in liminal states are dependent on the agents who manage the transition: the state administering agency, the compliance consultants, the EHR vendors who promise RHTP-ready systems, the technical assistance providers. This dependency creates opportunities for exploitation — overpriced consulting, unnecessary system purchases, compliance theater that satisfies the auditor without building genuine capacity. The liminal organization, uncertain of its own competence and desperate for guidance, is the ideal customer for the compliance-industrial complex.

Douglas on How Institutions Think

Mary Douglas’s How Institutions Think (1986) argues that institutions do not merely constrain individual thought — they constitute it. The categories through which people perceive, classify, and reason about the world are not purely individual cognitive products. They are socially produced by the institutions within which people are embedded.

In healthcare: the category “patient” is an institutional construction. The category “compliant” (as in “the patient is non-compliant with medication”) is an institutional construction that locates the problem in the patient’s behavior rather than in the system’s design, the medication’s side effects, or the patient’s social circumstances. The category “readiness” (as in “organizational readiness for RHTP”) is an institutional construction that defines what the organization should be ready for and on whose terms.

Douglas’s insight is that these categories feel natural to the people who use them — they are invisible as institutional products because they are the water in which institutional actors swim. The compliance officer does not experience “compliance” as an institutional category imposed from outside. She experiences it as the obvious, natural way to organize her work. The physician does not experience “quality metrics” as a contestable institutional construction. He experiences them as a reasonable (if annoying) measure of what he does. The institutional categories have been internalized — they have become part of the habitus, in Bourdieu’s terms — and their institutional origins have been forgotten.

The Category Problem in Regime Change

When the institutional regime changes, the categories that people have internalized become misaligned with the new environment. This produces a specific form of disorientation that is neither cognitive (it is not a failure of reasoning) nor emotional (it is not simply anxiety). It is categorical: the person’s classificatory system — the way they sort the world into meaningful patterns — no longer fits.

The grants manager who spent a career thinking in Medicaid categories (fee-for-service, managed care, state plan amendment, waiver) now confronts a different categorical world (uniform guidance, cost principles, indirect cost rate, expenditure deadline, milestone reporting). The words are different. The logic is different. The assumptions about what matters, what counts, and what is at risk are different. She is not incompetent. She is categorically displaced — fluent in a language that the new environment does not speak.

This categorical displacement is invisible to the structural frameworks. Resource dependence theory sees the organizational response to changed resources. Institutional isomorphism sees the organizational conformity to new regulatory expectations. Neither sees the individual human being struggling to reclassify her professional world — the confusion, the loss of competence, the disorientation of finding that the expertise she spent a career building is suddenly the wrong expertise.

Herzfeld’s Framework

Michael Herzfeld’s The Social Production of Indifference: Exploring the Symbolic Roots of Western Bureaucracy (1992) asks why bureaucratic systems routinely produce outcomes that the people within them would reject as individuals. The welfare caseworker who denies benefits to a family she personally sympathizes with. The compliance auditor who flags a finding that she privately considers trivial. The program officer who enforces a deadline that he knows will harm the organizations it is meant to help.

Herzfeld’s answer is that bureaucracies produce indifference through the social construction of categorical distance between the bureaucrat and the person affected by the bureaucratic decision. The compliance framework does not require the auditor to care about the organization. It requires her to assess whether documentation meets standards. The categorical structure of the work — form, checklist, finding, resolution — abstracts the human consequence from the administrative action. The auditor is not indifferent as a person. She is indifferent as a functionary, because the bureaucratic role requires the suppression of personal judgment in favor of categorical application of rules.

Indifference in the Grant Compliance System

The RHTP compliance system produces indifference structurally:

The distance between the rule-maker and the rule-follower. The federal compliance framework (2 CFR 200) was written by Office of Management and Budget staff in Washington, D.C., for application across all federal grant programs — education, housing, transportation, healthcare. The rules are domain-general by design. They do not know that the sub-grantee is a 12-person behavioral health clinic in rural Nebraska. They do not know that the indirect cost rate negotiation will consume 40 hours of the executive director’s time — time she would otherwise spend on patient care. The rules cannot know this, because legibility (Scott) requires abstraction from local context. The distance is structural, not personal.

The audit as institutional ritual. Audits are sometimes described as accountability mechanisms. Anthropologically, they are also institutional rituals — performances of legitimacy that serve symbolic functions independent of their technical findings. Michael Power’s The Audit Society: Rituals of Verification (1997) documented how the expansion of auditing across institutional life produces “audit cultures” in which the primary organizational concern becomes auditability rather than performance. The organization asks not “Are we doing well?” but “Can we demonstrate that we are doing well?” The shift from substance to demonstrability is a direct consequence of the legibility imperative: what cannot be documented cannot be audited, and what cannot be audited does not institutionally exist.

Compliance as performance. Erving Goffman’s dramaturgical analysis (The Presentation of Self in Everyday Life, 1959) offers a framework for understanding compliance behavior: the organization maintains a “front stage” performance (the compliance documentation, the policies and procedures manual, the grant report) and a “back stage” reality (the actual practices, the workarounds, the gaps between documentation and behavior). The front stage is designed for the audience (the funder, the auditor). The back stage is where the actual work happens. The gap between front stage and back stage is not deception. It is a structural feature of all institutional life — the inevitable divergence between the legible performance and the illegible practice.

IV. Sensemaking Under Radical Uncertainty

Weick’s Framework Applied

Karl Weick’s sensemaking framework, introduced in the ethnography document, takes on specific significance under conditions of regime change. Weick argued that sensemaking is an ongoing, retrospective process: people act, observe the consequences of their actions, and construct narratives that make those consequences intelligible. Sensemaking is not planning (deciding what to do in advance). It is interpreting (making sense of what has already happened and what is currently happening).

Under conditions of radical uncertainty — which the RHTP transition represents for many organizations — sensemaking faces specific challenges:

The cues are ambiguous. The RHTP solicitation, the state implementation plan, the compliance guidance — all are new, unfamiliar, and subject to revision. The organization’s leaders are reading documents they have never seen before, in a regulatory language they have not mastered, with consequences they cannot fully predict. The cues they extract from this environment are noisy and uncertain.

The frames are inadequate. Sensemaking depends on frames — prior experience, mental models, organizational narratives — through which new information is interpreted. The frames available to RHTP-navigating organizations were formed in the Medicaid era. Interpreting RHTP through Medicaid frames produces systematic misreadings: the organization sees grant funding as revenue (because Medicaid was revenue), sees compliance as billing-adjacent (because Medicaid compliance was centered on billing), and sees the expenditure deadline as a fiscal year (because Medicaid operated on annual cycles, not five-year grants with three-year performance periods).

The identity is in question. Weick’s most powerful insight is that sensemaking is identity-linked: people make sense of events in ways that are consistent with their sense of who they are. An organization whose identity is “safety-net provider for the underserved” will make sense of RHTP differently than an organization whose identity is “community health enterprise building self-sufficiency.” The same policy, the same grant terms, the same compliance requirements produce different sensemaking outcomes depending on the organizational identity through which they are interpreted.

Sensemaking is social. It does not happen in individual minds. It happens in conversations — in the hallway, in the break room, in the leadership team meeting, in the parking lot after the all-staff. The stories that circulate through the organization about what RHTP means, who will benefit, who will be harmed, and whether it will work are the sensemaking products that shape organizational behavior. These stories are ethnographically observable. They are not observable through surveys, metrics, or compliance reviews.

V. Narrative, Memory, and Organizational Identity

How Organizations Remember and Forget

Organizations have memories — but not in the way databases have memories. Organizational memory, as James March described it (Exploration and Exploitation in Organizational Learning, 1991), is carried in routines, rules, stories, and the embodied practices of experienced members. It is distributed, informal, and vulnerable to loss through turnover.

Paul Connerton’s How Societies Remember (1989) distinguishes between inscribed memory (written records, documents, archives) and incorporated memory (bodily practices, habits, rituals). Healthcare organizations have both: the inscribed memory of their policies, procedures, and documentation, and the incorporated memory of how the experienced nurse starts an IV, how the billing clerk navigates a denied claim, how the executive director handles a board meeting when the news is bad.

The RHTP transition threatens both forms of memory. Inscribed memory becomes partially obsolete when the compliance framework changes — the old policies and procedures manual is no longer sufficient for the new regulatory environment. Incorporated memory is threatened by the turnover that regime change produces — experienced staff who cannot adapt, or who do not wish to, leave the organization and take their embodied knowledge with them.

The organizations that navigate the transition successfully will be the ones that manage the memory problem: preserving the institutional knowledge that remains relevant (how to care for this community, how to manage with limited resources, how to maintain staff morale under pressure) while building new institutional knowledge (how to manage RHTP compliance, how to report against milestones, how to plan for post-grant sustainability). This is a knowledge management challenge, but it is not a knowledge management technology challenge. It is a social challenge: maintaining the communities of practice, the mentorship relationships, and the narrative continuity that carry knowledge across institutional boundaries.

The Role of Narrative

Jerome Bruner (Acts of Meaning, 1990) argued that narrative is the primary mode through which humans organize experience into meaning. People do not experience their lives as data points. They experience them as stories — with characters, settings, conflicts, and resolutions (or irresolutions). Organizations are narrated entities: the staff carry stories about the organization’s past, its founding, its crises, its heroes, its failures, and its purpose.

The RHTP transition is, for the people inside the organization, a narrative event. The question is not only “Will we survive?” (the economic question) or “Can we comply?” (the regulatory question) but “Who are we becoming?” (the narrative question). The answer to the narrative question shapes the emotional and behavioral response of the staff more powerfully than any metric or analysis.

An organization whose narrative is “We are being abandoned by the government that was supposed to support us” will respond differently — with more resentment, more resistance, more cynicism — than an organization whose narrative is “We are being given the chance to build something durable for our community.” The facts (Medicaid cuts plus RHTP funding) are the same. The narrative is different. The narrative determines the organizational response.

These narratives are not set by policy. They are constructed locally, by the people inside the organization, through the social process of sensemaking. They can be influenced — by leadership communication, by early visible wins, by honest acknowledgment of what is being lost — but they cannot be controlled. The organization’s narrative is an emergent property of its people’s collective sensemaking. Like all emergent properties, it arises from local interactions (conversations, observations, shared experiences) and cannot be prescribed from above.

VI. What This Means for the Operating Lens

The anthropology of organizations under regime change fills a specific analytical gap in the capabilitygraph:

Public finance explains the policy mechanics of the transition. Organizational economics explains the structural constraints on organizational response. Workforce economics explains the labor market dynamics that make staffing the transition difficult. Operations research can model the throughput and capacity implications.

None of them explains how the people inside the organization experience the transition, make sense of it, narrate it, resist it, accommodate it, or transform it. The anthropological lens provides this — not as a soft supplement to the hard analysis but as the necessary complement that determines whether the structural predictions hold in specific cases.

The structural analysis predicts that most organizations will not successfully transform. The anthropological question is: For the ones that do — what did the people inside them do differently, and what conditions enabled it? This is the question that converts structural prediction into actionable knowledge. It is also the question that only ethnographic observation — sustained, situated, attentive to meaning and practice — can answer.

Intellectual Debts

Van Gennep, A. (1909). Les rites de passage. The three-stage structure of transition rituals: separation, liminality, incorporation.
Goffman, E. (1959). The Presentation of Self in Everyday Life. Dramaturgical analysis: front stage performance and back stage reality in institutional life.
Turner, V. (1969). The Ritual Process: Structure and Anti-Structure. Liminality, communitas, and the creative and dangerous potential of transitional states.
Douglas, M. (1986). How Institutions Think. Institutions as constitutive of the categories through which individuals perceive and reason.
Connerton, P. (1989). How Societies Remember. Inscribed and incorporated memory in social groups.
Bruner, J. (1990). Acts of Meaning. Narrative as the primary mode of organizing experience into meaning.
March, J. (1991). “Exploration and Exploitation in Organizational Learning.” Organization Science 2(1). The tension between exploring new possibilities and exploiting existing knowledge.
Herzfeld, M. (1992). The Social Production of Indifference: Exploring the Symbolic Roots of Western Bureaucracy. How bureaucratic systems produce categorical distance and institutional indifference.
Weick, K. (1995). Sensemaking in Organizations. Sensemaking as retrospective, social, identity-linked interpretation of ambiguous events.
Power, M. (1997). The Audit Society: Rituals of Verification. The expansion of auditing and the production of audit cultures where demonstrability replaces performance.
Scott, J. (1998). Seeing Like a State. Administrative legibility and the destruction of mētis.