Separating inpatient and outpatient ORs
By Stephen W. Earnhart, MS
CEO
Earnhart & Associates
Austin, TX
The company Starbucks made a significant business decision a few months ago. Their board decided that they needed to focus on what they thought they did best: Operate as a specialty coffee store. They gave up many of the more restaurant type of services they previously offered and are focusing on their core business and managing their growth, even to the point of downsizing the number of stores. I applaud that vision. Gutsy move.
A trend is developing in our workplace that is just as gutsy for health care executives: the separation of inpatient operating rooms from outpatient. The concept is not new; we have been doing this for years. What is new is the fact that many mainstream health care systems are now climbing onboard. We have several hospitals within the same health system that have made the plunge.
What is happening is beyond the "two classes" of patients that have operated in the past. There is a complete physical and operational separation of outpatient from inpatient services. Often the two are on different floors or even different buildings.
Both departments have their own staff. They have separate directors/administrators. They both function under the licensure of the sponsoring hospital, and point of services is under the same Medicare provider number.
There is no joint venture ownership from outside surgeons, but the existing surgeons play a significant role in the structure and management of the outpatient center. Their role is key to the success of the separation. Much of our interaction is spent with the (new) staff and the users of the operating rooms.
As you would expect, not all embrace this vision. There are surgeons who will reject the new center and choose instead to own equity in a freestanding venture. However, most surgeons have embraced the concept. They often are eager to join the "advisory board" established as a conduit for surgeon input into a wide range of operational and managerial functions by the management team.
There is clearly resistance from existing surgical department staff, especially those involved with management and operations. The operating room environment has long been dominated by strong personalities, egos, and protectionism. It's hard to blame them; a significant chunk of business is being carved out of their domain. Their feelings need to be recognized and respected. I, too, would not welcome this change, if truth be told.
However, the operating room environment is overdue for an overhaul. Frequently hospitals function around the convenience of their staff and/or patients and not anesthesia and the surgeons. Cost control is difficult with many hospital management information systems (MIS), and management of those costs is now a requirement. A lower cost provider of surgical services no longer needs to be the corner surgery center.
There is another factor driving hospital leaders to respond not only to their own need to control costs, but the need for separate inpatient and outpatient operating room environments. It is the reality that many surgeons cannot become investors in new or existing surgery centers. The cost of building new centers has almost tripled over the past several years. That, coupled with the inability of surgeons to obtain a loan to buy into these centers, is making it so difficult that many no longer are trying.
While this often is not a popular internal change for many established health care providers, I believe we will see only an increase in systems adopting this concept. (Earnhart & Associates is an ambulatory surgery consulting firm specializing in all aspects of outpatient surgery development and management. Contact Earnhart at 1000 Westbank Drive, Suite 5B, Austin, TX 78746. E-mail: [email protected]. Web: www.earnhart.com.)
The company Starbucks made a significant business decision a few months ago. Their board decided that they needed to focus on what they thought they did best: Operate as a specialty coffee store.You have reached your article limit for the month. Subscribe now to access this article plus other member-only content.
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