In the News: September 21–27

Obstetrics Units Are Closing in Rural Hospitals

A recent Health Affairs study reports the majority of rural counties lacked access to hospital obstetrics services from 2004 to 2014. Due to poor Medicaid reimbursement rates, which pose financial strain for providers, obstetrics is vulnerable to rural closures, and these closures disproportionately affect rural counties with lower median household incomes, high populations of African-American women and lower Medicaid income-eligibility limits. As a result, pregnant women must travel significant distances for maternity care, which is associated with lower rates of prenatal care. This may contribute to the observed disparity in health care outcomes (higher maternal death, higher infant mortality) among women in rural communities relative to their urban counterparts.

While most salient in rural communities, organizations across the country are facing tough decisions about the closure of obstetrics services amid declining volumes and reimbursement. For a more thorough assessment of strategic options for obstetrics units, please read the Sg2 FAQ: Analyzing Vulnerable Obstetrics Units.

US Hospitals Invest in Outpatient Locations as Inpatient Admissions Decline

A recent Wall Street Journal article highlights US hospital operators investing in outpatient locations, such as surgery centers, emergency rooms and urgent care clinics, as their inpatient admissions continue to decline. As the number of Americans on high-deductible health plans increases, some hospital operators see outpatient growth as a strategy to maintain or gain market share as more patients look for convenient, lower-cost care.

Sg2 has a track record of projecting inpatient declines that reflect actual volume trends. Over the next 10 years, Sg2 projects a 2% decline in adult inpatient discharges and 15% growth in outpatient volumes across the US. To learn more about inpatient and outpatient demand projections from our Impact of Change® national demand forecast, read the Sg2 Expert Insight: Sg2 2017 Impact of Change Forecast: Finding Growth.

Revenue Cycle Firm Announces Support for Blockchain Transactions

Change Healthcare, a revenue cycle and analytics firm, announced its administrative and financial network, which processes over $2 trillion in claims annually, will support blockchain transactions by the end of 2017. The company believes blockchain technology will enable payers and providers to process claims and payments more efficiently and could possibly be leveraged for real-time claims management.

Sg2 continues to follow blockchain technology as excitement around its usage in health care grows. For a primer on blockchain and recommendations for how organizations can follow this potentially disruptive technology, listen to the Sg2 technology netcast: Health Tech Weekly: Blockchain Basics.

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As of February 11, 2016, Vizient, Inc. has completed its purchase of MedAssets Sg2 and spend and clinical resource management segments from Pamplona Capital Management, LLC. MedAssets revenue cycle business will continue to operate as a wholly-owned subsidiary of Pamplona Capital Management LLP.

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