Not too long ago, the undisputed formula for success as a hospital administrator was simple: Keep the beds filled with paying patients. Now, as the tide of reform sweeps across the landscape, that equation quickly is being turned on its head as healthcare enters the new world of value over volume.
It may seem counterintuitive, but most of the leaders in this nation's dysfunctional system of healthcare now agree that a reliance on in-patient admissions and revenue is a thing of the past—a relic of the (soon-to-be) bygone era when volume, high-margin procedures and fee-for-service ruled the C-suite and guided almost every strategic decision.
As we all move quickly and irrevocably toward a system where pay-for-performance trumps fee-for-service, administrators recognize that fewer patients in hospital beds is not a recipe for disaster. In fact, this seismic shift to non-acute-care services is a clear signal that we are doing our jobs more effectively by focusing not on sickness—but on health.
The healthcare system still has a long way to go to measure up to the Triple Aim of better health, higher quality and lower costs. But we will not succeed in these lofty yet attainable goals unless we significantly reduce traditional hospital admissions.
At Catholic Health Initiatives, we think we could likely discharge about half the patients now occupying beds in our 87 hospitals if we had better-developed alternative delivery models, including hospitals-at-home; outpatient surgery centers with the capability of overnight observation; high-intensity ambulatory-care services; and an even more robust and effective telemedicine infrastructure.