Micro-Hospitals Fuel Growth Strategy at a Texas Health System

Philip Betbeze, March 2, 2017

Micro-Hospitals Fuel Growth Strategy at a Texas Health System

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Part of CHI St. Luke's growth strategy involves combining inpatient and outpatient services into a smaller, more scalable and less capital-intensive facility model: the micro-hospital.

Health systems used to depend on high-dollar inpatient care for growth. Not anymore.

With health plans and Medicare seeking to move care to lower-acuity, and thus lower-cost, sites, and with advances in technology adding to the practicality of moving procedures out of the hospital, the outpatient environment is poised for growth, while inpatient may stagnate.

CHI St. Luke's Health, a six-hospital health system in Houston, is like many health systems that responded to HealthLeaders' recently released annual Industry survey. It is looking outside the traditional hospital environment by adding physician practices and other outpatient sites of care.

David Argueta
David Argueta

But part of its growth strategy involves combining inpatient and outpatient services into a smaller, more scalable and less capital-intensive facility model, the micro-hospital.

CHI St. Luke's opened its first four-bed micro-hospital, Springwoods Village Hospital, in January 2016. David Argueta, its president, calls the facility an "innovative solution to get clinically appropriate high-quality care in a low-cost environment."

Speed to Market
Argueta, who is president of CHI's Woodlands-area facilities, which includes the micro-hospital as well as the 242-bed The Woodlands Hospital and 30-bed Lakeside Hospital, says he views micro-hospitals in general as one of the ways the health system is able to grow access points in a thoughtful manner.

"It really brings value-added services together in a more cost-effective manner than a big hospital or individual clinics," he says.

What also made this micro-hospital a particularly attractive opportunity is that it allowed CHI St. Luke's to negotiate an exclusive deal within the master planned community of Springwoods, in suburban Houston, 10 miles away from The Woodlands Hospital.

"We had an opportunity that a lot of people don't, which is to grow with the community," says Argueta, who adds that the hospital is scalable. The micro-hospital features four inpatient beds, 10 ED bays, four operating suites, two endoscopy suites, imaging, labs, and pharmacy and dietary departments.

Philip Betbeze

Philip Betbeze is the senior leadership editor at HealthLeaders Media.

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