Declining average daily census. Part 2: Possible solutions.

Abstract

Several possible solutions are available to hospitals experiencing a declining average daily census, including: Closure of some U.S. hospitals; Joint ventures between physicians and hospitals; Development of integrated and coordinated medical-fiscal-management information systems; Improvements in the hospital's short-term marketing strategy; Reduction of the facility's internal operation expenses; Vertical more than horizontal diversification to develop a multilevel (acute through home care) regional health care system with an alternative health care payment system that is a joint venture with the medical staff(s); Acquisition or management by a not-for-profit or investor-owned multihospital system (emphasis on horizontal versus vertical integration). Many reasons exist for an institution to choose the solution of developing a regional multilevel health care system rather than being part of a large, geographically scattered, multihospital system. Geographic proximity, lenders' preferences, service integration, management recruitment, and local remedies to a declining census all favor the regional system. More answers lie in emphasizing the basics of health care regionalization and focusing on vertical integration, including a prepayment plan, rather than stressing large multihospital systems with institutions in several states or selling out to the investor-owned groups.