Hospitals and health systems must increasingly learn how to handle cost pressures and widespread industry consolidation, and harness those trends into a profitable management strategy to keep their institution firmly grounded and better able to serve patients.
Christopher Weaver, MD, senior vice president of clinical effectiveness at Indianapolis-based IU Health; Parveen Chand, COO of Academic Health Center-Adult Hospitals for IU Health; and Steven Merahn, MD, CMO of Novi, Mich.-based Centria Healthcare, spoke about the cost pressures and widespread integration challenges hospitals face during an April 13 panel at the Becker's Hospital Review 9th Annual Meeting, which took place April 11 through April 14 in Chicago.
Here are three thoughts the panelists had regarding industry pressures and challenges.
1. "The shift must be carefully understood. Everyone knows it's going to happen, so we need to look for value in everything we do," Mr. Chand said, regarding the industry shift toward value-based payment models. "We must pay very close attention to timing and how we can manage expenses. If we can better understand every step that improves our value proposition, that will be the key to our success."
"We all need to figure out how to partner with other players in our industry," he added. "In Indiana, we're fortunate to have skilled nursing collaboratives, for example, that target community partners with the same mission and objective [as IU Health]. … Hospitals must work with partners who'll add to their value proposition."
2. According to Dr. Weaver, industry consolidation implies "less money is coming" to hospitals everywhere. In Indiana, there's an ongoing discussion about microhospitals and outpatient centers, which "are pulling off the good payers" who would rather receive cheaper care at outpatient locations than at traditional hospitals, he said. Hospitals shouldn't depend on outpatient facilities as a major source of revenue because they tend to "pull out bigger fruit (payers)."
3. "We found respect for the profession was far more valuable than economic package," said Dr. Merahn, in terms of recruiting more physicians to his organization's workforce. "It's necessary to get physicians involved in the recruitment process. By re-engineering physicians' role to get them more intimately involved in operations at the institution, we changed our recruiting strategy to draw more physicians into our workforce."