Hospital Growth at Your Own Risk

Philip Betbeze, for HealthLeaders Media , January 15, 2010

On the other hand, growth is far from the only method he's using to better compete under a reimbursement system that shows signs it may shrink, despite the lack of focus on cost control in the healthcare reform bills being reconciled right now.

"On the expense side, we're dramatically reducing our costs through a regular review of key leadership in any areas that have opportunities for expense reform—from consolidating two behavioral health hospitals into one to consolidating services or eliminating them entirely."

For Mountain States, one area where significant expense savings can be realized is through elimination of obstetric services in "smaller hospitals that may not need to be duplicated all over the place like they usually are."

So growth is possible and should be pursued, according to some of the top senior leaders at a variety of institutions we've profiled in the cover story, but it has to be balanced by selective cost control where possible, and elimination of services in some facilities that might better be consolidated at one institution.

When I hear about this type of reorganization, I'm reminded that healthcare's not nearly as far along as other industries in taking advantage of economies of scale. Perhaps 2010 will be the year of smart growth through consolidation and efficiency. If so, that's not a bad place to start, and best of all, it doesn't require a legislative effort to achieve.

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Philip Betbeze is senior leadership editor with HealthLeaders Media.

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