Health care is a complex system that requires in-depth thinking, expertise, and ethical consideration so to encapsulate and further associate the concepts you are learning, in most modules, you will have the opportunity to reflect in-depth on relevant interconnected concepts. The expectations of the reflection paper include (1) Answer completely all the prompts or questions; (2) reflection should be between 800 and 1,000 words; (3) use APA-style; (4) turn in via Canvas by end of the Day 7 of the module (11:59 PM).
This reflection is a bit different since you need to do some calculations and answer specific questions. You can answer the questions using an Excel or Word document.
The table below gives some operational statistics for two hospitals located in the same community. Use the table to answer the following questions.
1. Calculate the following measures for each hospital (wherever appropriate, calculate the measure for each pay type). Discuss the meaning and significance of each measure and point out the differences between the two hospitals.
A. Hospital capacity
B. ALOS
C. Occupancy rate
2. Operationally, which hospital is performing better? Why?
3. Do you think the nonprofit hospital is meeting its community benefit obligations in exchange for its tax-exempt status? Explain.
4. Do you think the hospitals have a problem with excess capacity? If so, what would you recommend? In your answer to this question, please consider how hospital governance may impact the ability of an administrator to make changes.
Table
Calendar Year 2016 Nonprofit Community Hospital (A) Proprietary Community Hospital (B)
Number of Beds in Operation 320 240
Total Discharges 12,051 9,230
Medicare 5,130 3,876
Medicaid 3,565 2,118
Private Insurance 3,356 3,236
Total hospital days 72,421 51,684
Medicare 36,935 26,359
Medicaid 23,175 12,921
Private Insurance 12,311 12,404
Total inpatient revenues $ 45,755,000 $ 35,800,000
Dollar value of community benefits $ 5,000,000 $ 3,500,000
Guide On Rating System
Vote
To answer the questions, we need to calculate the following measures for each hospital:
1. Calculate the following measures for each hospital:
A. Hospital capacity: This refers to the total number of beds in operation for each hospital.
- Hospital A: 320 beds
- Hospital B: 240 beds
B. ALOS (Average Length of Stay): This measure indicates the average number of days a patient stays in the hospital.
- Hospital A: Total hospital days / Total Discharges = 72,421 / 12,051 = 6.01 days
- Hospital B: Total hospital days / Total Discharges = 51,684 / 9,230 = 5.59 days
C. Occupancy rate: This measure indicates the percentage of beds that were occupied during a specific period. It is calculated by dividing the total inpatient days by the available bed days.
- Hospital A: Total hospital days / (Number of beds * 365) = 72,421 / (320 * 365) = 62.23%
- Hospital B: Total hospital days / (Number of beds * 365) = 51,684 / (240 * 365) = 59.64%
2. Operationally, which hospital is performing better? Why?
To determine which hospital is performing better, we need to consider multiple factors.
- Hospital A has a higher number of beds in operation, higher total discharges, higher total hospital days, higher total inpatient revenues, and a higher dollar value of community benefits.
- Hospital B has a lower ALOS and a slightly higher occupancy rate.
Based on the given information, Hospital A seems to be performing better operationally, as it has higher patient volumes, revenues, and community benefits.
3. Do you think the nonprofit hospital is meeting its community benefit obligations in exchange for its tax-exempt status? Explain.
Yes, the nonprofit hospital appears to be meeting its community benefit obligations. It has a higher dollar value of community benefits compared to the proprietary hospital. This suggests that it is providing a greater level of charity care and services to the community, which aligns with its tax-exempt status. However, further analysis would be needed to fully assess the extent and impact of the community benefits provided by the nonprofit hospital.
4. Do you think the hospitals have a problem with excess capacity? If so, what would you recommend? In your answer to this question, please consider how hospital governance may impact the ability of an administrator to make changes.
Both hospitals have occupancy rates below 100%, indicating that there is some excess capacity. Hospital A has a slightly higher occupancy rate, but it still has available beds. Excess capacity can be costly for hospitals, as they incur fixed costs regardless of whether beds are occupied.
To tackle the problem of excess capacity, the hospitals could consider the following recommendations:
- Develop partnerships with other healthcare providers in the community to better manage patient flow and maximize bed utilization.
- Analyze and adjust staffing levels to match patient demand more accurately, reducing costs associated with idle capacity.
- Explore opportunities for diversification into outpatient services, which may increase revenue streams and reduce the reliance on inpatient care.
- Implement effective marketing and outreach strategies to attract more patients and improve the fill rates of available beds.
Hospital governance plays a crucial role in implementing these recommendations. Administrators need the support and collaboration of the hospital's board of directors to make changes in operations. Governance structures should be responsive to changes in the healthcare landscape and be open to strategic partnerships and innovative approaches to address excess capacity effectively.
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