What You Need to Know About The Bedless Hospital That You Can Build: The Massive Outpatient Center™
Here’s the latest twist on the hospital-less future of hospitals. Like an ASC, it’s one that you can build. I call it the Massive Outpatient Center™ or “MOC™“ for short.
As I’ve written many times on the blog and in my book, The Impending Death of Hospitals, hospitals as we know them are dying.
Due to a convergence of factors from technology to payor pushback to the end of inefficiency, care is quickly moving from the inpatient to the outpatient setting.
Examples abound, from the increased pace I’ve seen in my own practice in connection with ASC deals, to hospital downsizing (read Honey, I Shrunk The Hospital), to bedless hospitals.
An example of the latest interesting twist on the non-hospital future of hospitals is the Lauritzen Outpatient Center now being completed by Nebraska Medical Center in Omaha. To me, and probably to the entrepreneurial among you, what’s most interesting about the Lauritzen model is that it’s easily replicable.
That’s because the model isn’t new at all. Chances are that the office-based physicians reading this already work in the same sort of location, just one that isn’t as organized.
The Lauritzen Outpatient Center is essentially a hospital-owned medical office building (MOB) with office space for various physician practices and a 10 O.R. ASC. Like many MOBs, there will be a pharmacy on the first floor. There will be orthopedic clinic, an imaging facility, and office space for allergists, ENTs, general surgeons, plastic surgeons, oral and maxillofacial surgeons, urologists, and other physicians. But, and you guessed it, there won’t be any overnight beds.
The Lauritzen facility is new construction costing, according to press reports, $71 million. In many areas of the country, there’s a plethora of empty non-healthcare facilities that can be repurposed into similar models for a fraction of the investment. And, of course, there are many closed or soon-to-be-closing hospitals available for conversion.
Unless and until something political is done to break the prohibition on Medicare-certified physician-owned hospitals, many physicians not already participating in those deals will be denied the right of ownership. Yet, there’s little to no difference between bedless hospitals and large ASCs that are completely within the scope of permissible physician ownership.
So, too, are new variants such as the Massive Outpatient Center™.
Wisdom. Applied. 100 - Bastiat, A Magician, And Medical Group Decision Making
A magic show is about misdirection: that which is seen and that which is not seen. There's a lesson there for medical group leaders, courtesy of Frederic Bastiat, the 19th Century French political economist.
I’m writing this on an American Airlines flight from Santa Barbara to Phoenix. It’s early morning. The plane just arrived from Phoenix about 30 minutes ago.
We’re still at the gate. I can see into the cockpit. The pilots are going through their checklist.
The flight attendant just asked the 12 of us in first class if we’d like something to drink before takeoff. But, she said, there's no coffee because the coffee machine is broken.
Inside the small terminal, just up the jetway and perhaps 67 feet to the left, is a coffee stand.
Why didn't someone have the initiative to order a dozen coffees and bring them on board?
But that would entail the desire to delight passengers and the taking of initiative. Neither of which are on general supply at any airline, let alone among among any fight crew.
Checklists are mandatory for pilots. Yes, it’s rote work, but it prevents them from glossing over necessary steps. But at the same time, flying the plane entails individual decision-making.
The same balance is needed in connection with customer service or patient service or whatever you want to call it: a blend of following the rules and procedures and the ability to jump in and correct a problem or, even better, to bring a smile to someone’s face.
Perhaps American believes that if they just don't drag anyone off a plane à la United, they’re delivering good service?
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Having fallen for the fallacy that there’s profit in market share, hospitals have gorged on acquisitions and on employment and alignment of physicians. Many physicians have been willing participants through practice sales and in the belief that there’s safety in hospital employment. But it’s becoming evident that physician employment leads to losses and that integrated care delivers neither better care nor lower costs. And now, technology is about to moot many of the reasons for a hospital’s existence. How can your practice survive and even thrive in the post-hospital world?
The Impending Death of Hospitals is available for purchase in hard copy or in Kindle format on Amazon or you can download a complimentary PDF version here.
Today’s medical groups must confront multiple challenges: The impact of Obamacare. Increasing commoditization. More competition, not just from other physicians and medical professionals, but also from hospitals, investor-owned groups, and disruptive ventures. Yet at the same time, the future of healthcare offers medical groups tremendous opportunity.
This small book is a collection of essays, of thoughts as thinking tools for your success. Read. Think. Succeed. Repeat.
Some days, it seems as if everyone, from anesthesia groups to vascular surgery practices, is talking about selling their practice to a larger group, to private equity investors, or to a hospital.
The reality is that some practices can be sold, some can never be sold, and some have nothing to sell.
The reality also is that there are a number of strategic alternatives to a practice sale.
A perfect storm of factors is accelerating the market for hospital-based medical group mergers and acquisitions.
The healthcare market is changing rapidly, bringing new sets of problems.
How can you find a solution, how can you engage in the right development of strategy, and how can you to plan your, or your group’s, future without tools to help clarify your thinking?
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Recent Interviews and Published Articles
Mark's article Why Your Compliance Efforts May Be Worthless was published in the Spring 2017 volume of Communique. Read or download here.
Mark was quoted in the article ASC Regulatory Areas That Developers Need To Pay Attention To published on Nov. 9, 2016 in The Ambulatory M&A Advisor. Read or download here.
Mark's article OIG Advisory Opinion Secrets and Strategies was published in the Summer 2016 volume of Communique. Read or download here.
Finders keepers, losers weepers. Except in connection with overpayments from Medicare, then it’s a violation of the federal False Claims Act leading to significant liability—that is, unless you repay the overpaid sum within 60 days. Read CMS Resets the Clock for Return Of Medicare Overpayments published on AnesthesiologyNews.com in May 2016. Read or download here.
Mark's article A New Strategy To Profit From Interventional Radiology, co-authored with Cecilia Kronawitter, was published on AuntMinne.com on May 23, 2016. Read or download here.
Three of Mark’s blog posts were republished as a column entitled Practice Challenges in the Spring 2016 issue of the Pennsylvania Society of Anesthesiologists Newsletter, the Sentinel. Read or download here.
Mark's article Is There An Interventional Radiology ASC (irASC) In Your Future? was published in the April/May 2016 volume of Radiology Business Journal. Read or download here.
Mark's article Impending Death of Hospitals: Will Your Anesthesia Practice Survive? was published in the winter 2016 volume of Communique. Read or download here.