A series on Profit Cycle Management in Healthcare Part 2: Facing the Change


Several industry trends are prompting healthcare organizations to think more broadly about evolving their financial management tool. As our series around Profit Cycle Management continues, we will look at each one of these pivotal trends individually.

Healthcare organizations continue to focus on acquisitions or alliances to grow market share and coordinating better care. As these institutions grow into more integrated systems, they need to manage resources efficiently to take advantage of their scale. According to recent Gartner research and internal GE Healthcare analysis, the number of single hospital systems in the United States is expected to decrease by about 29%, while the number of hospital-based systems is slated to increase by 28%. As such, the total number of systems will decrease by about 17% during this time period.   Also, according to SG2 Consulting, inpatient procedures are expected to decline by four percent while outpatient procedures will increase by 28%- all while the total population increases by about 18%.   In essence, care must be delivered in the most efficient location (and the most efficient manner given payment pressures)-all while maintaining or even improving quality. The upshot: There will be fewer, bigger and more integrated systems attempting to treat a bigger population in a more efficient manner.


[1] Internal GE analysis of proprietary Gartner market research study in August 2011

[1] Internal GE analysis of proprietary research by SG2 in July 2012

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