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|Articles - July/August 2014|
|Friday, July 11, 2014|
Page 3 of 6
Building a Nimble Hospital
If the ACA improves access to preventive care, fewer people will need to visit the ER or be admitted to the hospital. From a Hippocratic perspective, lower hospital utilization is a good thing, says Davidson. “If you’re keeping people healthier, you’re keeping them out of the hospital, so you’re ultimately having less cost on the system. That’s awesome.”
But from a business standpoint? Not so good. Hospitals have large fixed costs: property maintenance, food service, laundry. If revenues go down, it will be difficult to lower expenses to match. “Hospitals can change,” Davidson says, “but they’re like battleships: You turn the wheel, and it sometimes takes a mile or two to actually turn.”
ER visits are actually up, Davidson notes, due to pent-up demand from previously uninsured people. But hospitals are preparing for a future drop in patient volumes by developing more efficient, standardized processes and considering ways to “re-deploy” their staff. “If you reduce volume, it’s going to have an impact on how many employees you need,” Davidson says. “You’ve got to start thinking about how to retrain people to do other things.”
Recent data from the Oregon Employment Department shows although the state’s health care industry as a whole has been growing, hospital employment has stagnated since 2007 and is projected to grow by a relatively slow 14% between 2012 and 2022.
Financial pressures on hospitals will likely lead to consolidation and collaboration. That’s already happening outside Portland, where some institutions share back-office resources without fully merging. “People are realizing we’ve got to figure out how to deliver coordinated care; we’ve got to figure out how to be more cost effective,” says Jim Diegel, president and CEO of Central Oregon’s St. Charles Health System, which merged with Madras’s Mountain View Hospital last year and entered into a lease agreement with Prineville’s Pioneer Memorial Hospital in 2008. “Smaller organizations, or organizations that don’t have the talent, resources and capital internally, are saying, ‘We need to have a different relationship going forward.’”
For an example, look no further than Prineville. This spring St. Charles, whose revenues grew more than 10% to $556 million in 2013, broke ground on a new $30 million hospital slated to replace Pioneer Memorial in 2015. St. Charles Prineville will be two-thirds the size of its predecessor. It will have 20% fewer beds, and MRIs will be performed by a contractor in a trailer that will also serve St. Charles’s Madras hospital. The lean design of the new facility anticipates the industry’s shift away from acute care, explains Bob Gomes, CEO of St. Charles Bend and St. Charles Redmond: “We’re building our infrastructure looking to where health care is going, not where it is today.”
Friday, March 27, 2015
BY ROBERT MULLIN
A new energy-sharing agreement sparks concerns about independence and collaboration in the region's utility industry.
Friday, May 08, 2015
BY CHRIS NOBLE | PHOTOS BY JASON E. KAPLAN
Hagfish may not have evolved much over the last 300 million years, but their protein-heavy slime promises advances in super-materials.
Friday, April 24, 2015
BY BEN DEJARNETTE | INVESTIGATEWEST
Timber companies and environmental groups take a stab at collaboration to boost logging and restoration in Oregon fires.
Friday, April 24, 2015
BY AMY MILSHTEIN
Male tech workers speak out on the industry's gender troubles.
Wednesday, April 01, 2015
BY LINDA BAKER
Leaders in Oregon's ag sector gathered this morning in Portland’s Coopers Hall winery/taproom to discuss the role of the region as an export gateway, impediments to exporting products and solutions to containerized shipping challenges.
Thursday, March 26, 2015
BY JACOB PALMER
Power lunching at the Court Street Dairy Lunch in Salem.
Monday, April 27, 2015
BY KIM MOORE
Are we too quick to diagnose corruption?
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