Will supersized hospitals be a legacy of healthcare reform?

January 12th, 2015

A few days ago in Forbes, Robert Pearl, MD, the CEO of The Permanente Medical Group, argued that “Hospitals May Be Disappearing In The Era of Health Care Reform,” and that the hospitals that remain will be higher-volume facilities that offer improved clinical outcomes.

I understand why he might feel that way. Just a few weeks ago, I wrote about a study that suggested high-volume hospitals have better outcomes (while also tending to suffer lower patient satisfaction scores) than low-volume hospitals.

Pearl makes the case that it’s OK if the number of hospitals shrinks because people are better able to travel than they were in the past, so it isn’t necessary to have "a hospital in every town." He concludes his piece by asserting that “if there were fewer hospitals with higher volumes, quality would rise and the overall spend on hospital services would decrease. We should not underestimate how difficult this process will be or how long it may take. But once it is complete, patients will barely miss the old hospital down the street.”

We’ll see.

It’s certainly true that various forces, including but not limited to healthcare reform, have led to increased use of ambulatory surgery centers, more consolidation of hospitals into large health systems, and – unfortunately, in my opinion – greater risks to the financial health of smaller, more rural hospitals.

In Georgia, where I live, “Three rural hospitals have shut down this year in the state, and as many as 15 more may be closing their doors in the coming months,” according to an article from GPB News.

Sorry, but I can’t quite bring myself to agree that the eventual disappearance of lots of rural facilities is a good thing, either for the health of rural patients or for the financial health of the communities in which these facilities provide jobs.