Only 46% of Northwell's business now stems from hospitals

New Hyde Park, N.Y.-based Northwell Health has been ahead of the outpatient migration trend, which has gathered momentum since the pandemic, and is the primary growth area that many hospitals and health systems are prioritizing for the future.

In line with this trend, Northwell's hospital sector now accounts for only 46 percent of its total business, CEO Michael Dowling told Becker's Hospital Review. That 46 percent is down from 49 percent in 2021 — the most recent full-year financial report available — when the system's revenue hit $14.5 billion. 

"Other operating revenue" accounts for about 4 percent of Northwell's total business, while outpatient revenue (about 50 percent) makes up the rest.  

Mr. Dowling said the 21-hospital system's "biggest growth is in outpatient care." It currently has 890 outpatient facilities and growing. "If you're relying on the hospital to be the core provider of the future, you're going to lose," he said.

About 95 percent of hospital and health system executives are projecting outpatient volumes to increase this year, with 40 percent expecting increases of 10 percent or more, according to a March 2 analysis published by Guidehouse, a healthcare consulting firm.

As outpatient care volumes rise, 41 percent of hospital and health system executives also expect inpatient volumes to continue to decline. Around 17 percent of executives anticipate decreases of 10 percent or more on the inpatient side, according to the analysis, which is based on responses from 182 CEOs, CFOs and COOs, among other hospital executives.

Executives also expect significant emergency department volume increases, with one-third projecting by 10 percent or more, while a quarter of leaders expect a 10 percent uptick in elective procedures.

"Most health systems are still experiencing volumes below pre-COVID levels, resulting in sizable market challenges," Richard Bajner, Guidehouse partner and payer/provider leader, said in a statement. "These shifts should inform strategic growth efforts that are focused on person-centered care, such as excellence in ambulatory services, to create sustainable business models that attract and retain patients while driving financial resiliency in an era of volatility."

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