No more 'heads in beds': Outpatient visits outpace inpatient, Deloitte finds

Inpatient hospital services aren't driving as much revenue to health systems and could actually become a liability in the future, according to a new Deloitte report on outpatient trends. 

The report highlighted how consumer demands for convenience, shifts to value-based payment systems and technological advances are tarnishing the inpatient business model.

"Gone are the days of a one-week hospital stay after surgery, when health systems were only focusing on making money from 'heads in beds,'" according to the report. "Many patients now have procedures in ambulatory centers and go home the same day."

For the report, researchers with the Deloitte Center for Health Solutions examined hospital financial data from the Medicare Cost Report to better understand inpatient and outpatient revenue trends from 2011-18. Twenty interviews from health system executives, including CMOs, chief transformation officers and population health executives, were also conducted.

From 2011-18, hospital outpatient revenue grew at 9 percent, compared to inpatient revenue at 6 percent. Since 1994, the aggregate outpatient share of total hospital revenue grew from 28 percent to almost half of hospital revenue by 2018.

Researchers predict the shift will only grow, especially as technology advances and consumers continue demanding services that keep them out of the hospital.

"Our findings are a call to action for health systems to invest in care delivery in outpatient, home, virtual, and other alternative settings. Instead of focusing on capturing more hospital inpatients, health systems should start planning for a future where buildings full of beds will likely be a memory," the researchers said.

Find the full report here.

More articles on healthcare finance:
U of Vermont Health Network blames operating loss on Epic install
Woman sued by Alabama hospital over $31K bill: 'I wish you'd have let me die'
Aetna draws criticism for automatic down-codes for office visits

Copyright © 2023 Becker's Healthcare. All Rights Reserved. Privacy Policy. Cookie Policy. Linking and Reprinting Policy.


Featured Whitepapers

Featured Webinars