Image isn't everything. In fact, in a reformed healthcare system, a hospital's reputation won't mean nearly as much without reliable price and quality outcomes statistics to buttress its reputation.
That's why it's vital that academic medical centers continue to trudge down the treacherous path of managed care. Traditionally, teaching hospitals have been positioned as high-cost centers of excellence. But in an industry destined to be driven by capitation and contracting, academic medical centers must slash costs and invest in managed care.
Teaching hospitals are showing signs of progress, but they still have a long way to go. The University Hospital Consortium reports about half its members have formed joint contracting arrangements for its physician and hospital services. Only 53% have plans to contract for primary care. Moreover, the Prospective Payment Assessment Commission says teaching hospitals' costs can be from 28% to 41% higher, on an average per case basis, than those of their community hospital counterparts.
It's no wonder that academic centers often are viewed as too complicated and too costly for managed-care organizations. And the skepticism is bound to increase as the nation grapples with containing medical costs.
Teaching hospitals deserve financial support for providing research, graduate medical education and specialized patient care. But that doesn't mean they can continue to rest on their reputations. As Bruce Japsen reported in a Feb. 7 cover story, accountability, affordability and value will determine the fate of many teaching hospitals. Welcome to the 1990s.