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Will Full-Service Hospitals Go the Way of the Dinosaurs?"In many cases we won't have full-service hospitals anymore," said John Horty, a Pittsburgh attorney and chairman of the Estes Park Institute. Like many statements intended to grab an audience's attention, this one was pretty earth-shaking. Hyperbolic statements like this one cause smart people to wonder, if only for an instant, "If that's true, what will happen to me?" I heard Horty say this last fall when I served as a moderator for a roundtable session at one of Estes Park Institute's six annual conferences. Estes Park specializes in helping hospital executive and physician leaders prepare themselves for future leadership challenges by identifying macro healthcare trends and predicting their likely effects on hospitals, so bold statements can become somewhat routine over the course of a four-day conference. In this case the audience was fairly quiet to begin with, but when Horty offered his remark, the difference in background noise was unmistakable. Horty isn't kidding about full-service hospitals. Many such facilities-especially community hospitals, the backbone of the healthcare system-will likely have to evolve significantly to survive amid heightened competition from outpatient surgery centers, imaging centers, traditional physician offices and even supermarket quick clinics. The degree to which they will suffer financially from such competition will vary based on factors like certificate-of-need laws or the size of the market in which they compete. But it's clear that many will no longer be able to afford to try to be all things to all people. Rather, the ones that survive and thrive, Horty says, will be those that can differentiate themselves by dominating in certain specialties or by developing clinical or contractual connections to bigger hospitals to treat hospital-based diseases.I would qualify his statement by saying those that thrive will differentiate themselves by dominating certain well-reimbursed specialties, but that's a minor quibble. Despite such apparent negativity, Horty is optimistic about hospitals' ability to adapt. "This evolution won't kill community hospitals," he says. Rather, he argues, the best-performing community hospitals will be able to stay independent by integrating services with larger systems. But how to do this without being swallowed up? Community hospitals "will eventually have a way to get part of the fee for referral to the bigger hospitals," Horty says. "It's unethical now, but it won't be in the future."We shall see. -Philip Betbeze




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