There’s an interesting similarity between management of hospitals and of hotels. In both, occupancy rate is critical.
Hotels want as many beds filled as possible. Every empty room means a loss of revenue opportunity that night. It’s time and money that can’t be reclaimed. Hospitals, on the other hand, need to get the right balance of occupancy. Too little and fixed costs swamp the financials. Too much, and the maintenance of care quality can be difficult.
Hospitals also have important revenue streams and responsibilities other than inpatient. Outpatient care can mean additional treatment for patients — and additional revenue — without putting extra strain on some important parts of the hospital’s staff and infrastructure.
Outpatient care will likely be an important strategic focus of hospitals in the coming year, according to a press release about the Advisory Board’s Annual Health Care CEO Survey.
The No. 1 concern was improving patients’ access to care in ambulatory or outpatient settings, according to the nationwide survey of 183 C-suite executives conducted in December 2016 and January 2017. The topic ranked sixth a year ago. A new topic for this year’s survey, finding innovative ways to reduce expenses, entered the ranks in second place. Just behind was boosting market share for outpatient surgical procedures, up from 10th a year ago.
“This shift in topic rankings reflects a change in hospital and health system priorities in part driven by current discussions on health care policy reform,” said Chas Roades, Chief Research Officer at Advisory Board. “Improving cost-effective access for consumers, who are likely to bear more direct financial responsibility for the cost of care, will be a growing concern for health care providers in the coming decade. Our survey shows executives are considering new strategies to remake their cost structures to respond to the changing environment.”
A driving reason for the direction is the growth of healthcare clinics, whether standalone or embedded in another facility, like a drug store chain. Here’s what Advisory Board Managing Director Ben Umansky told Modern Healthcare:
“There is opportunity for outpatient clinics to grow in new ways but they also pose a threat,” he said. “Those who occupy that space are nimbler, less expensive, easily accessible and offer more exposure. Healthcare organizations realize they need to bolster that arena.”
According to Bureau of Labor Statistics estimates, health clinics and outpatient services will be two of the fastest-growing industry sectors in the coming years. As more clinics come into existence and expand into additional services, there could be a significant impact on traditional treatment and business strengths of hospitals.
In addition to outpatient activities, hospitals are also interested in telehealth, with 83 percent of executives planning to increase investment in the area this year, according to the American Telemedicine Association’s 2017 Telemedicine Executive Leadership survey.
Are you interested in finding a rewarding and lucrative healthcare career that fits your individual strengths and interests? Find out how education can help you adapt to the changing healthcare landscape. American Sentinel University is an innovative, accredited provider of healthcare management degrees, including an MBA Healthcare and Master of Science Business Intelligence and Analytics.