Hospitals are expected to implement new payment and delivery models now that the Supreme Court has upheld the Patient Protection and Affordable Care Act. But community hospitals may have difficulties transforming their organizations due to limited resources and other challenges.
CHC’s president and CEO Mike Williams spoke this month with Becker’s Hospital Review about the challenges facing community hospitals and immediate actions to take in order to weather current and future changes in healthcare.
The four main challenges are:
- Revenue cycle. As Medicare reimbursement levels decline, community hospitals may suffer most because they serve a disproportionate number of Medicare and Medicaid patients. In addition, many community hospitals lack the clout to secure the best rates from managed care providers.
- Access to capital. In part due to reduced reimbursement, community hospitals also lack access to capital. This prevents them from updating their facilities, which can affect patient volume and quality of care.
- Physician recruitment. There’s a nationwide physician shortage, and on top of that, it can be difficult to attract primary care physicians and specialists to remote or rural areas.
- Hospital-physician alignment. Community hospitals, like all hospitals, struggle to work cooperatively with medical staff to improve quality and lower costs.
Six actions can be taken immediately to address these challenges:
- Optimize internal operations. The goal is to provide care in a cost-effective manner with the best possible outcomes.
- Benchmark performance against similar hospitals. Comparing clinical data can help identify opportunities for improvement.
- Assess feasibility of independence. After making as many internal improvements as possible, community hospitals must assess the feasibility of remaining independent, now and in the future.
- Consider partnerships. If internal improvements aren’t sufficient to compete in the marketplace, community hospitals should consider forming relationships with other organizations. When seeking a partner, community hospitals should make sure the hospital’s culture aligns with the prospective partner’s culture; define expectations upfront; and make clear what they must provide in return and the amount of control they will cede for the expected benefits of the partnership.
- Ensure board involvement. The board may need to be educated about its responsibilities, including overseeing finances, clinical quality and strategy.
- Collaborate with physicians and involve them in the hospital’s governance.
Read the full Becker's Hospital Review article.
If these health reform challenges sound all too familiar, CHC can help with operations assessment, board education, strategy development and, if necessary, partnership options. Call us today at 972.943.6400.