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Healthcare

Healthcare Paradigm Shift: Emphasis on Outpatient Care

Over the last several years there has been an increase in the number of outpatient visits at hospitals throughout the U.S. Outpatient services encompass medical procedures (minor surgeries and chemotherapy) and diagnostics (MRI, CT, and lab tests) performed in a medical center that doesn’t require a patient to stay overnight. The American Hospital Association (AHA) reported that outpatient visits increased more than 1% per year since 2013, while inpatient admissions decreased approximately 2% per year over the same period of time.1 This seems to be a trend that will continue over the next few years.

A number of factors have played a role in this shift towards outpatient care. As technologies have improved along with therapeutic drug options, providers are now able to care for a wider range of illnesses on an outpatient basis. Changes to insurance reimbursement policies over the last five years have also emphasized the need for hospitals to provide high quality care at an affordable price. This includes reducing the length of hospital stays as well as the number of visits to the emergency department. In order to achieve these goals there has been an enhanced focus on prevention, early detection, and appropriate follow-up.

A 2017 survey of 183 chief executives at top hospitals found that their number one priority was improving access to outpatient care.2 Healthcare consumerism continues to increase as patients are bearing more of the burden of their healthcare costs especially with more and more individuals choosing to enroll in high deductible health plans. This has led to an increase in the number of outpatient clinics being built with the numbers topping 2,000 in 2015.3

Other factors that have led to a shift towards outpatient care include:

  • Cheaper staffing: Staffing costs are reduced because ambulatory centers aren’t open overnight.
  • Outpatient Surgical Centers: As the population continues to live longer, there increased demand for outpatient procedures and therapies.
  • More competition: As competition increases, outpatient services are a way for health systems to differentiate themselves. Thoughtfully located outpatient centers have the potential to attract a large number of new patients.
  • Reduced fixed costs: Outpatient facilities cost less to build than a hospital and, with no overnight stays and limited operations on the weekends, operational costs are lower as well.

Now that health systems are aware of the need to expand their outpatient services and understand some of the benefits of doing so, they are working to incorporate outpatient care into their overall strategy.

The rest of this post will focus on four (4) things that health systems are doing to position their hospitals as leaders in outpatient care.

1. Attracting new physicians

In order to expand their outpatient care network, hospitals are working to attract new physicians and physician groups. This can be difficult because there is a shortage of physicians, especially those in primary care (family medicine, internal medicine, pediatrics, OB-GYN). Because America’s healthcare system is emphasizing value-based care, hospitals need to better engage physicians in their strategic objectives and daily administrative duties. While this will be an appealing opportunity for some it will be viewed as a burden by others, and has the potential to causes issues when academic institutions acquire community hospitals.

2. Improving Patient Retention and Preventing Leakage

One of the top reasons patients fail to receive follow-up care is that they lack convenient access to physicians. Patients may go from practice to practice or decide not to be seen at all because there isn’t a provider near them. This can cause patients to receive uncoordinated care leading to diagnoses being missed, rerunning of diagnostic tests, and in some cases unnecessary treatments. Healthcare executives are seeing this as an incentive to expand their outpatient services and address an unmet need in their respective communities. Another method being used to curb patients “falling through the cracks” is improving patient scheduling methods and technology. The aim is to make sure patients have a scheduled follow-up visit before they walk out the door.

3. Adding Telehealth Opportunities

Telehealth involves using technologies such as videoconferencing, electronic monitoring, and wireless communications to address the health needs of patients. Telehealth allows for quick access to clinicians that patients, especially those in remote locations, may not otherwise be able to access. Patients in these programs are able to receive care without ever having to leave their house. As a result, health systems are incorporating this technology as part of their drive to expand outpatient services. This can boost revenues by increasing the number of patients that clinicians are able to care for. It can also allow health systems to avoid the costs involved in building and maintaining their own outpatient care facilities.

4. Converting Hospitals into Outpatient Centers

Some healthcare executives are considering maximizing their current assets by repurposing some or part of their inpatient facilities into outpatient departments. The shift from inpatient to outpatient care has left beds unfilled at some hospitals. Therefore, it may be financially beneficial to transform hospitals into ambulatory care facilities in order to expand outpatient services to meet the growing demand.

Conclusion

There is little doubt that a medical paradigm shift is underway in which patient volumes are moving toward the outpatient setting. For healthcare executives it is therefore imperative that they develop a strategy that provides convenient and cost-efficient ambulatory care to their communities.

Kevin Anderson is a graduating medical student at Duke University School of Medicine and will be starting at LEK Consulting later this year. He’s most passionate about healthcare redesign, patient engagement, and the life sciences. His free moments are spent traveling  and enjoying sporting events with his wife and daughter.

Image: Pexels

References:

  1. Robeznieks, Andis. “Hospital Admissions Continued to Fall in 2013, Outpatient Visits Rise.” Modern Healthcare, 27 Jan. 2015, modernhealthcare.com/article/20150127/NEWS/301279903.
  2. Advisory Board Company. “Hospital Executives See Future Growth in Outpatient, Higher-Value Care, Survey Finds.” PR Newswire: News Distribution, Targeting and Monitoring, Apr. 2017, prnewswire.com/news-releases/hospital-executives-see-future-growth-in-outpatient-higher-value-care-survey-finds-300436269.html.
  3. Shrank, W.H. J Gen Intern Med (2017) 32: 387. https://doi.org/10.1007/s11606-016-3946-1
  4. Ambulatory Surgery Center Association. “ASCs: A Positive Trend in Health Care.” Economic Impact – Advancing Surgical Care, 2015, ascassociation.org/advancingsurgicalcare/aboutascs/industryoverview/apositivetrendinhealthcare.

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