The State of Hospital Service Lines: Current Challenges, Future Directions

Many hospitals have organized their services as service lines with their own governance and operations that report back to senior hospital leadership. Three common service lines are cardiovascular, orthopedics and neuroscience. Ross Swanson, senior vice president of Corazon, a national consulting firm for healthcare specialties, describes the current strengths and challenges of each service line and future directions for hospitals.

Ross Swanson discusses challenges and opportunities of hospital service lines.1. Cardiovascular. Cardiovascular service lines are one of the most mature service lines at hospitals, according to Mr. Swanson. Most hospitals with cardiovascular service lines have a clear structure with key offerings, including catheterization labs, critical care unit(s), non-invasive testing and often interventional cardiology, as well as open-heart surgery. In addition, the structure typically allows for communication across different areas and between multidisciplinary providers.

"Cardiology has become such a mature service line because cardiac disease has been at the forefront for many years as the number one cause of death. A lot of emergencies at your door have a cardiovascular focus," Mr. Swanson says. "It's a core business unit." The high awareness of cardiovascular needs in the community has enabled hospitals to develop over time a clear grasp on successful operations and strategies for this service line. From a business perspective, full-service cardiovascular programs can represent up to 40 percent of a hospital's total revenue, according to Mr. Swanson.

2. Orthopedics. In contrast, hospitals with orthopedic service lines often focus on the current operations more than future strategy, according to Mr. Swanson. While most hospitals offer orthopedic services, many have not considered growth strategies beyond simply offering the service.
Mr. Swanson suggests hospitals with orthopedic service lines begin to strategize by formally assessing the local market with reliable data. Hospitals should study the hospital's patient population to determine their market share and opportunities for growth. "A lot of places rely anecdotally on what competitors are doing and not on formal review," Mr. Swanson says. "[Information tends to be] corroborated by physicians but not by an intense market study."

In addition to an external evaluation of the market, hospitals should consider internal strategies of growth by looking at new orthopedic technologies and expanded services they could offer. For example, Mr. Swanson says more orthopedic programs are looking at the full continuum of care (admission to post-discharge) and procedures are becoming less invasive, which can expand the service line and draw in more patients.

3. Neuroscience. Neuroscience service lines are one of the least mature service lines nationally, and hospitals have only recently recognized neuroscience as a distinct business unit, according to Mr. Swanson. For many hospitals with neuroscience service lines, typically neither the organizational structure nor the strategy is fully understood, and these are areas of growth for the future. "Internally, it appears as though neuroscience is 10 years behind cardiovascular in terms of service line development, even though the procedures are very technologically advanced," Mr. Swanson says. "It just hasn't been operationalized as a distinct business unit as with other specialties."

As awareness of the prevalence and severity of stroke increases, hospitals' recognition of neuroscience as a key offering grows as well. "There's [now] more recognition of the urgency that occurs with neurological events that had always been there for cardiac events for many years," Mr. Swanson says.

He says many states are promoting and some are requiring by law that ambulances take stroke patients to the nearest primary stroke center, which may mean bypassing closer hospitals that do not have this accreditation. While similar requirements for heart attack receiving centers and orthopedic trauma centers have existed, the awareness of the importance of primary stroke centers is relatively new.

Neuroscience strategy

For hospitals considering creating a neuroscience service line, the initial strategy may be to convince stakeholders that a dedicated neuroscience program is needed. For hospitals that already offer these programs, strategy is more focused on awareness among hospital stakeholders and the public of what services comprise a neuroscience program.

"The biggest strategy to propel growth in neuroscience is to create awareness around what the procedures are, what an emergent event is in neurology," Mr. Swanson says. For example, many hospitals are educating the community on the signs of a stroke and the importance of immediate treatment for strokes.

While neuroscience includes numerous subspecialties, stroke, due to its incidence and mortality rates, is often "the front door" to hospitals' neuroscience programs, Mr. Swanson says. Other offerings may include an epilepsy center, a sleep center, a Parkinson's clinic and a headache clinic, among others. The opportunities for the development of distinct treatment centers in neurosciences is much greater compared to other service lines due to the complexity of neurologic disease, according to Mr. Swanson.

These other neuroscience services may not generate a huge or immediate financial return on investment, but they can create a halo effect — increasing patient volume to that service or a different service by increasing the overall perception of the hospital as capable and advanced, according to Mr. Swanson.

Different tactics for different service lines

Each service line is at a different level of development and has different opportunities for growth. Cardiovascular service lines tend to be mature, and some areas of future growth include certification for specific cardiovascular-related programs, such as being certified as a heart attack receiving center. Orthopedic service lines are less mature, and should focus on market analytics, breadth of services and new technology/procedures as strategies of growth. Neuroscience service lines, while the least mature, have perhaps the greatest potential for growth, and should focus on awareness and education, stroke programs and additional services that can create halo effects.

More Articles on Hospital Service Lines:

7 Features Cardiologists Look for in Hospital Cardiology Service Lines
Moving Beyond Traditional Hospital Operations: The Value of Integrating Service Lines

What Hospital Cardiovascular Co-Management Looks Like in Action

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