As we look ahead to 2007, again we see great changes on the horizon for healthcare. With continued scrutiny of the cost and quality of care from both internal and external sources, Corazon believes that hospitals will no doubt be forced to direct efforts towards ensuring high-quality care delivery in an operationally-efficient setting.

This focus on cost is most evident in CMS’s gradual shift to cost-based (rather than charge-based) reimbursement. Beginning with the 2006 changes to the relative weights, many DRGs have already been impacted, most within the cardiovascular specialty. Organizations will now have to dedicate increased efforts to tracking and/or creating documentation that supports a more granular DRG system that will result in charges and payments that are matched to the complexity of patient diagnoses and condition. Appropriate documentation that drives optimal coding processes to accurately capture the severity of patient illness will continue to make CV services among the most profitable hospital specialties.

The expiration of the moratorium on specialty hospitals will also impact the healthcare industry in 2007. Though Corazon does not expect a sharp rise in the number of specialty hospitals so soon after the moratorium was lifted in August 2006, increased interest in freestanding facilities dedicated to one clinical specialty (most often cardiovascular or orthopedic care) has been a more immediate result. This issue can impact facilities of all types across the country…Those organizations not thinking of building a freestanding facility must instead consider the possibility of their competitor doing so. No matter your individual situation, the specialty hospital issue should be “top of mind” as this trend gains momentum in both urban and rural communities.

Angioplasty with off-site surgical support will likely remain a hot topic in the months ahead. Regulations are already changing in states that have traditionally restricted coronary intervention without surgery on site, while demonstration projects, clinical studies, and state-sponsored programs continually prove the safety and efficacy of this practice. Increased patient access to life-saving angioplasty in all areas of the country is the ultimate goal of this initiative. Likewise, efforts to reduce time-to-treatment to less than 90 minutes will be a benchmark that all programs will be measured against. But as the legislative debate continues, hospitals in states where regulations are poised to change can expect a surge in cardiac program expansions, triggering increased competition for cardiovascular patients.

Also, recruitment challenges will continue to plague the healthcare industry. As we find in our consulting and recruitment business, experienced and qualified administrative and physician leaders, especially for cardiovascular services, are always in high demand. Strengthened recruitment efforts and continuing development for current leaders will be increasingly necessary.

And finally, increased interest in joint ventures and partnership arrangements will likely continue, especially with heightened interest in new and innovative pay-for-performance models that facilitate hospital and physician involvement in high-quality care delivery.

Despite these general predictions for the year ahead, Corazon recommends relationship-building between hospitals and physicians; a focus on documentation; and benchmarking for clinical, financial, and operational indicators, both of which can help gauge and drive program success, no matter what the future holds.