Hospitals may have to focus less on inpatients to thrive in the future

Brick wall with the word hospital

Hospital C-suite executives may want to move more of their business to outpatient services in order to grow their revenues, according to a new report.

Hospital dependence on inpatient volumes will shift relatively quickly to outpatient services, according to the report by consulting firm Frost & Sullivan.

“Growth in the number of ambulatory care providers, reduced reimbursements and quality-based payment models have required hospital CEOs to create new models of care delivery,” the report said.

“The ACA, reduction in Medicare funding and reimbursements shifting from fee-for-service to value-based payments have impacted the way hospitals compete in the U.S. health system,” said Frost & Sullivan senior research analyst Tanvir Jaikishen in a statement. “Additionally, declining inpatient volumes and lowering reimbursements are fueling a wave of strategic acquisitions and partnerships aimed at increasing the patient base and improving negotiating power with insurers.”

Hospitals already appear to be making this transition: Many focus their acquisitions on non-acute care holdings, such as retail clinics and physician practices.

The report also predicted that hospitals and healthcare systems will create their own in-house insurance plans in order to better expand their patient base. Other industry observers believe that this may be a good time for hospitals to launch their own plans because the level of trust the public has with them is higher than with traditional insurers. However, managing such a new enterprise is extremely challenging.

Many larger hospitals and healthcare systems have been seeking out C-suite executives with specific strategic visions and specific ideas of what they believe the future care delivery systems will look like, making the task of executive recruitment more challenging.

- read the report
- check out the statement