Hospital leaders, pressured with steering their organizations toward better care at reduced costs, may be inadvertently heading toward a financial precipice.
Follow this thought to its logical conclusion and you can see that achieving those aims would essentially put the most successful hospitals out of business.
Of course, healthcare executives deal more often with the daily realities of running a hospital, rather than abstract theories. Practically speaking, there will always be patients in need of hospital beds, no matter how efficient we collectively get at practicing medicine.
But the fact is that the number of beds needed is falling. In 2009, the average number of hospital beds was 2.6 per 1,000 people. In 1999 the national average was 3.0—a 13.3% drop. Length of stay stats are dropping, too.
Through investments in technology and care coordination to prevent readmissions, efficiencies are being gained at an accelerating pace. In California, already significantly below the national average, the rate fell from 2.2 to 1.9—a 9.13% drop between 1999 and 2009. And further cuts are coming.