HGMT #3: Hospitals and healthcare systems

What are the four levels of healthcare

Primary care provides basic, first-contact, and continuous care. Primary care providers treat a broad range of conditions, coordinate the patient’s overall care, and refer patients to specialists when necessary (family physicians, internists, pediatricians, nurse practitioners, and physician assistants).

Secondary care is short-term care for more serious illnesses or injuries that require greater specialization. Patients often enter secondary care through a referral from a primary care provider (childbirth services, emergency services, and general surgery).
Tertiary care provides highly specialized treatment for complicated conditions (heart surgery, renal dialysis, and neurosurgery).

Quaternary care is even more specialized and often involves experimental treatments at major academic or research facilities.

What is ambulatory care?

Ambulatory care, also called outpatient care, is care that does not require an overnight stay. It includes many different ways of receiving healthcare (telehealth, mobile care, retail clinics, urgent care, primary care offices, and specialty centers).

What is acute care, and does it always require hospitalization?

Acute care is short-term treatment for an urgent, severe, or potentially life-threatening condition. It does not always require an overnight stay because it can be delivered in both inpatient and outpatient settings (treatment for an accident, heart attack, poisoning, or seizure).

How are inpatient and outpatient care different?

Inpatient care generally involves admission to a hospital for longer than 24 hours. Outpatient care does not require an overnight stay and is usually less expensive (laboratory tests, X-rays, immunizations, emergency-room visits, and outpatient surgery).

What major shift has occurred from inpatient to outpatient care?

More services and surgeries are being moved to outpatient settings because of improved technology, lower costs, telehealth, and pressure to avoid expensive hospital stays. From 1994 to 2018, outpatient hospital revenue rose from about 28% to 52%, while inpatient revenue fell from about 72% to 48%.

What is a community hospital?

A community hospital is locally governed, open to the general public, and not owned by the federal government. It provides short-term medical or surgical care to its surrounding community and may be urban or rural, general or specialized, and for-profit or not-for-profit.

How are not-for-profit and for-profit hospitals different?

Not-for-profit hospitals must reinvest their profits into the hospital and community and are usually tax-exempt because they provide community benefits (charity care, health education, and community-health programs). For-profit hospitals may distribute profits to investors and generally pay income and property taxes.

What are state and local government-owned hospitals?

These hospitals are owned by government entities (cities, counties, states, or special districts). They often serve communities and patients whose healthcare needs may not be fully met by private hospitals.

What is a public hospital district?

A public hospital district is a local government entity created to establish, fund, and operate healthcare services in a specific area. It can collect taxes to support a hospital that might not survive through patient revenue or donations alone (a property-tax levy used to support a rural hospital).

Why do rural hospitals often struggle financially?

Rural hospitals usually serve fewer patients, have lower occupancy rates, and offer more limited services, but they still face the high fixed costs of operating a hospital (Between 2005 and 2022, 175 rural hospitals closed, and about 600 more were at risk)

What is a hospital system? Why are more hospitals joining large healthcare systems?

A hospital system is a group of hospitals that shares services or resources. A multihospital system includes two or more hospitals owned, leased, managed, or coordinated by one central organization.

Hospitals join systems to improve efficiency, share technology and electronic health records, respond to lower reimbursements, and combine resources. In 2021, about 68% of community hospitals belonged to a healthcare system.

How are general and specialty hospitals different?

General hospitals treat a broad range of conditions and populations (surgery, obstetrics, pediatrics, and emergency care). Specialty hospitals focus on a specific population, condition, or service (children’s hospitals, orthopedic hospitals, psychiatric hospitals, and cancer hospitals).

What is the difference between licensed, available, staffed, and occupied beds?

Licensed beds are the maximum number the hospital is legally permitted to operate. Physically available beds are licensed beds that are set up for use. Staffed beds also have enough employees available to care for patients, while occupied beds are staffed beds currently being used by patients.

What is an academic medical center?

An academic medical center combines advanced patient care, education, and research. These hospitals train healthcare professionals, conduct research, provide highly specialized services, and often care for low-income or medically complex patients.

What is a safety-net hospital?

A safety-net hospital is committed or legally required to care for patients with limited access to healthcare because of financial hardship. It often treats uninsured and Medicaid patients and may depend on government subsidies, taxes, or bonds (Jackson Memorial Hospital in Miami).

How do the Veterans Health Administration and Military Health System differ?

The Veterans Health Administration mainly provides hospital and outpatient care to eligible veterans. The Military Health System serves active-duty military members, retirees, and their families through military hospitals and clinics

What is the difference between vertical and horizontal integration?

Vertical integration combines different parts of the healthcare supply and delivery chain under one company (an organization owning an insurance plan, pharmacy-benefit manager, pharmacy, and physician practices). Horizontal integration combines similar organizations (one hospital system purchasing or merging with other hospitals).

How can hospital consolidation affect healthcare competition?

Mergers may improve coordination and efficiency, but they can also reduce competition and give hospital systems more power to raise prices. Prices and insurance premiums are often higher in markets where a small number of systems control most hospitals.

Which three groups usually lead and govern a hospital?

The governing board provides ultimate oversight, hires the CEO, and sets the hospital’s direction. The CEO and senior managers operate the organization and manage its finances and strategy. Medical-staff leaders supervise providers, clinical care, and professional performance.

Why are more surgeries performed in outpatient settings?

Technology has made many procedures safer and less invasive, while outpatient facilities generally cost less than hospitals. Outpatient surgeries increased from about 13% of surgeries in 1980 to around 70% in 2017 (colonoscopies, cataract surgery, joint aspiration, and pain injections).

Why has inpatient hospital use declined

Inpatient use has declined because of higher deductibles, pressure to prevent readmissions, greater use of observation beds, expanded outpatient care, preventive care, and declining birth rates. Today, inpatient admission is generally reserved for serious illness or trauma.

What are micro-hospitals, and why might they become more common?

Micro-hospitals are small facilities, often containing about 8–50 beds, that provide essential local services at a lower cost (emergency care, laboratory testing, imaging, exercise facilities, and pharmacies). They may offer more convenient and personalized care than large traditional hospitals.

How are fee-for-service and capitation different?

Fee-for-service pays providers separately for every service they deliver, which encourages providing more services. Capitation pays a fixed amount per patient for a set period, encouraging providers to control costs and prevent unnecessary care.