Background

Our client, a community hospital that is part of a loosely affiliated, five-plus hospital system in the Northeast, was struggling with financial challenges that were driving the organization’s operating margin deep into the red.  The hospital was facing pressure from competitors to both the east and the west, and struggling to retain referrals from its own on-staff physician base.

How HSG Helped

HSG facilitated the development of a three-year strategic plan for the organization, with a focus on physician alignment, geographic growth and service line development strategies that would increase retention of profitable business. The strategic plan also incorporated a long-term alignment effort that would result in the development of a Clinically Integrated Network that could be leveraged with the region’s payers.

Results

The hospital developed several ambulatory sites within its service area to stem outmigration of profitable services.  Professional service agreements were put into place with large independent groups to increase alignment.  Additional surgeons were recruited to stabilize profitable surgical ventures.  The employed physician network nearly doubled in size after two years, with a large focus on primary care.  This group was then leveraged to engage a handful of self-insured employers in the area. The relationships are currently in the beginning stages but appear positive to-date.  Overall, the hospital has seen double-digit growth in top-line revenue, and significant positive impact to operating margin, which is expected to continue in the future.

 

David W. Miller

Founder and Chairman