South Florida Hospital News
Tuesday May 18, 2021

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January 2014 - Volume 10 - Issue 7


Trends and Trade-offs

Today’s Florida Trend has a headline about hospital expansion. When you read the article, however, they are not expanding inpatient rooms or adding more beds. In fact, the population’s inpatient use rate continues to decline. This is, of course, good news unless you are a hospital CEO or CFO.
The three reasons inpatient bed occupancy has been and is continuing to decline are:
• We are taking better care of ourselves. We pay attention to what we eat. We wear seat belts and helmets. We go to the gym.
• Technology and pharmacology have made huge strides in the care and treatment of the ill and injured. The results are fewer requirements for the inpatient part of a hospital stay. Where certain procedures and medications used to necessitate 24 hour monitoring by skilled nursing personnel, now patients go home; or occasionally to a less intensive residential setting.
• Finally, government and private payers, including patients themselves, don’t and in some cases, won’t, pay for the “hotel” bill part of a hospital’s claim. One of the reasons there’s always been a push for “home and community based” care for seniors and the mentally ill is because when they are not “in a hospital” the patient or his family is paying for “room and board.”
What we are going to see in 2014 is the continuation of these trends and hospital leadership teams responses to them. One way to maintain an adequate revenue stream is to diversify the hospital’s portfolio of services and programs. Here, and around the country, hospitals are pursuing partnerships with doctors and health plans to become “accountable care organizations” (ACOs). Although this has a definitive meaning within the Affordable Care Act and the Medicare program, the basic concept is a risk taking health system focused on the health and welfare of a specified population group. Not too far away from the original vision of a “health maintenance organization,” keeping people out of the hospital is good for an ACO. Providing the comprehensive array of services needed to do that becomes the mission, and the participating hospital(s) get to keep some of the savings.
Interestingly, another response, and one that we are seeing more of here is South Florida, is hospitals attempting to develop and market as their “centers of excellence” those few specialties and sub-specialties that still require an overnight stay in a hospital. It is not a coincidence that lots of hospitals have decided they want designation as trauma centers or stroke centers. The one thing you can count on is that trauma and stroke patients spend the night. Last year the State Agency for Health Care Administration approved 4 more transplant programs here. Transplant recipients need inpatient care. In other words, a strategy for making up for a decline in inpatient utilization is to be sure your hospital has the constellation of services still requiring 24 hour care.
Finally, that leads to the 2014 trend that is most likely to maintain traction: competition. Although here at the South Florida Hospital & Healthcare Association we continue to see the kind of collaboration and collegiality that has been evident for almost 70 years, out there the competition for patients, doctors and health plan contracts is fierce. TV advertising of programs and services; billboards touting shorter ER wait times; and massive “education and outreach” campaigns will continue to fill the landscape. The good news is that South Florida has at least one of everything, and in some cases multiples of services only other cities can dream of. The bad news is all this supply side of the economic equation is expensive. And that, too, is unlikely to change in 2014.

Linda Quick is President, SFHHA. For more information, visit

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