Have a question or comment? Would you like to speak with someone?
Determining the Right Services in the Right Location
Over a two year period, a historically dominant player in the healthcare market lost over 4,500 inpatient discharges. In other words, the health system was losing over 50 patients per day because their relationship with referring providers soured and market volume was stagnant. Catalyst was brought in to identify strategies to stop the decline and improve profitability.
Approach and Solution
Capitalizing on service gaps and physician shortages was one way to increase market presence and better serve the community. Catalyst determined there was a significant gap between availability of primary care physicians and demand for their services. In addition, the market required more medical-based specialists like gastroenterology and endocrinology. The Planning Team quantified future volume need in the market and identified a location for an ambulatory clinic. The ambulatory outpost would help secure the referral stream to the system’s inpatient network.
Furthermore, even with market share growth, market dynamics suggested that the health system would never fill the number of inpatient beds the system currently had built infrastructure to support. Catalyst recommended that the smaller, community hospitals in the system’s rural submarkets transition into ambulatory hubs with fewer inpatient beds and the hospitals in the more urban markets serve as the system’s hubs, providing higher acuity and more complex care. This consolidation of inpatient beds would achieve greater economies of scale and lower the system’s overall cost structure.
Service Line Rationalization