Hospitals today are facing enormous pressures to perform financially. Most are diligently pursuing the revenue cycle, ensuring that DRGs yield the highest payout and that third-party payments are maximized. Most systems are mired in cost-cutting. Others are looking at service lines to determine how to serve their patients and physicians optimally. Still others are focused on branding, customer experiences, and competition.
And there are huge numbers of hospitals and health systems doing nothing different from the status quo, largely because they feel stuck with their circumstances, they are not certain what they can do, or they feel disempowered by a higher authority. The proverbial deer-in-the-headlights syndrome.
Of all the things hospitals can do to improve financial performance, the most significant actions are those that yield new revenues, both from new service lines and from newly developed service lines. As Ken Blanchard wrote through his character Carlos Grover, "...it's producing revenue, not squeezing expenses that separates the moneymakers from the also-rans. You can't cost-cut your way to prosperity." And isn't that what the business of healthcare should realize? If we are to responsibly champion this business of helping people become healthy and own their health, we must also champion a business model in which our performance yields prosperity, so that we can continue our mission unabated. This, to me, is an authentic definition of sustainable healthcare delivery.
There are many strategies to grow top line performance through effective service line development. Some strategies are acquisitive, some organic, others rententive. Most bring strategic collaboration and leadership into keen focus. Nearly all segment the market and concentrate on superior delivery. In upcoming pieces, I will interview experts who are doing this every day at their hospitals and health systems throughout the country.
--------Michael Harris
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