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Hospitals Find Their Role Diminished

Philip Betbeze, for HealthLeaders Media, October 18, 2013

The traditional hospital has become not only a high-cost boogeyman, but also a sign of the limits of a CEO's leadership capabilities. Buttressing a financially vulnerable hospital's business with ancillary services is one way CEOs are being innovative. Now other industry players need to catch up.

It used to be easier for reporters to cover hospitals.

There were hospitals—defined by providing inpatient care almost exclusively—and there was everything else. And never the twain should meet.

But the definition of what a hospital is has been getting blurrier and blurrier over the years.

Hospitals, increasingly, are a part of the whole. If they have not grown by branching out into other areas of greater opportunity in recent years, they've been absorbed by other organizations that have already made the transition into owning more and more pieces of the healthcare continuum, from rehab facilities and surgery centers to health clubs and even hospice.

The hospital has become not only the high-cost boogeyman, but also a sign of the limits of your capabilities. No organization wants to be known as "X Hospital" anymore. At least on a corporate level, it's "Health" or "Healthcare," which is thought to connote the idea that these organizations are not just for acute services anymore—they are the soup-to-nuts answer for your healthcare needs.

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3 comments on "Hospitals Find Their Role Diminished"


David Hold (10/23/2013 at 3:07 PM)
I agree that may be a solution another solution is for hospital administrators to learn basic principal of finance and instead of focusing what can I bill for it focus on the bottom line and realize that you just being able to bill for it does not guarantee profitability. Savings and eliminating waste can have the same effect on bottom line

bob sigmond (10/18/2013 at 3:41 PM)
Your "traditional hospital" is almost all gone. Today, hospital income from in-patient care in almost all the hospitals with which I am familiar makes up less than half of the total. The majority comes from ambulatory and related services. Check it out. Also, today, hospitals have the opportunity to entirely eliminate being paid from fees-for-service by contracting out the entire billing and collection function to a Blue Cross Plan or insurer which will agree to pay a single monthly check for all services, based on a collaborative strategic plan and budget. The contract, of course, would provide for monitoring monthly income and expenditures to make necessary immediate adjustments when the budgeted projections of the bottom line turn out to be inadequate. Also, if the bottom line turns out to be positive, funds would be available for capital expenditures. This arrangement enables the hospital to concentrate on improving quality and access, as expenditures decline, with increasing emphasis on population and community care. For the contracting hospital, there is no longer any uncompensated care, and no unpleasant involvement with patients about collections, and no longer any worries about the bottom line. For more information about this approach, call me at 215-561-5730, or e-mail. Right on, Bob

David Hold (10/18/2013 at 2:26 PM)
I can say finally the industry or at least some in the industry are waking up to reality. Over the past few years i have been preaching that the one thing the industry lacks is vision and they should be taking lessons from their banking colleagues who learned over a hundred years ago that if a customer wants to make a dollar deposit will not travel fifty miles to accomplish it however if he needs to borrow a large sum of money he will travel and that is called branching.