HSM 331 Norfolk State University SWOT Analysis of CMC Presentation
Excerpt of Case Study: Coastal Medical Center
See (Harrison, 2016, pp 1-28)
Coastal Medical Center (CMC) is a licensed, 450-bed regional referral hospital providing a full range of services. The primary service area is a coastal city and three counties, with a total population greater than 995,000, located in the Sunbelt. This tricounty area has had one of the fastest population growth rates in the country for the past five years. According to the local health planning council, the tricounty population is projected to increase by 15 percent from 2015 to 2020. Appendix A, at the end of the case study (in the textbook), provides detailed population statistics for the city and tricounty area.
The population growth rate for households (families) has been 1 to 2 percentage points higher than the overall population growth. The growth rate of the population under age 44 shows a young and growing community. Per capita (i.e., per person) income in the tricounty area is high and increasing. As the population of the tricounty area increases, the need for healthcare services is anticipated to increase. The area’s economy is largely supported by manufacturing, with service companies and agriculture accounting for another 35 percent. Unemployment is typically 6 percent. The overall poverty rate is 12.4 percent. A recent study revealed that 40,000 city residents are below 125 percent of the established federal poverty level.
Healthcare costs in the region are high in comparison to healthcare costs in most other areas in the state. In response to what they feel are excessively high healthcare costs, county businesses recently formed a business coalition, hired a full-time executive, and publicly stated their intent to achieve reduction in healthcare costs. The local press has expressed its concern about the high cost of healthcare in the local community and consistently bashes the area’s hospitals and physicians. The coalition refused to allow the three major medical centers in the area to join, despite the fact that each is a major employer.
Highlights of Coastal Medical Center
As a referral center, CMC offers almost every level of care, including a number of tertiary care services, with the exception of neonatology and severe burn-unit services. Many of its patients require high-intensity services. For this reason, its costs are the second highest in the entire state. The average length of stay of a patient at CMC is 9.2 days, compared to a statewide average of 6.4 days at hospitals of similar size and services. This difference is probably attributable to the intensity of services CMC offers. CMC’s expenses per patient day are also the highest in the state, with the exception of two large university-affiliated teaching medical centers. Its FTEs per adjusted occupied bed (7.5), paid hours per adjusted patient day (35.2), and paid hours per patient discharge (238.5) all greatly exceed those of competitors and the norms of comparable facilities. CMC is currently authorized for 2,240 positions but actually employs 2,259 FTEs. Salary expenses per adjusted discharge and adjusted patient day are $2,760 and $491, respectively.
A recent one-year market share analysis for the broader-eight-county region revealed the data presented in Exhibit Case.1. CMC has market advantage in substance abuse, psychiatrics, and obstetrics. JMC has market advantage in adult medical and surgical care. At a recent administrative meeting, the following CMC utilization figures for the year were reviewed:
Exhibit Case.1, One-Year Market Share Analysis
|Facility||Discharges||Percentage of Total|
A recent auditor’s report included the following notes:
Appendix H. Coastal Medical Center: Inpatient Data
Inpatient Utilization Statistics 2015 2014 2013 2012
Case-mix index 1.666 1.692 1.713 1.729
Medical MS-DRGs 66.26% 65.57% 65.00% 65.38%
Surgical MS-DRGs 33.74% 34.43% 35.00% 34.62%
Routine discharges to home 5,729 5,343 5,110 5,092
Discharges to other acute care hospitals 85 94 94 81
Discharges to skilled nursing facilities 1,360 1,346 1,238 1,305
Deaths 404 289 330 314
Other discharges 2,120 2,171 1,962 1,661
Total discharges 9,698 9,243 8,734 8,453
Psychiatric discharges (DPU, included in total) 493 508 451 443
Rehabilitation discharges (DPU, included in total) 139 171 141 166
Medicare Advantage (HMO) discharges 942 1,872 2,308 2,518
(not included in total)
2015 Statistics by Medical Services
Number Average CMI-
Medicare Length of Average Average Medicare Avg
Inpatients Stay Charges (5) Cost (5) CMI Cost (5)
Cardiology 1,513 3.6 23,498 6,550 1.030 6,362
Cardiovascular Surg 1,123 3.9 86,224 21,103 2.909 7,255
Gynecology 38 2.1 36,756 8,613 1.084 7,944
Medicine 1,691 5.3 33,073 10,221 1.283 7,967
Neurology 502 4.3 27,248 8,378 1,200 6,982
Neurosurgery 42 9.5 111,058 30,272 3.492 8,669
Obstetrics 12 5.2 20,415 9,146 .687 13,324
Oncology 101 5.5 39,450 11,021 1.638 6, 729
Orthopedic Surgery 795 3.8 61,015 17,228 2.369 7,271
Orthopedics 145 4.1 23,034 7,127 1.060 6,725
Psychiatry 459 10.5 30,824 14,766 .924 15,989
Pulmonology 796 4.9 32,695 9,258 1.419 6,522
Surgery 513 8.8 100,849 27,114 3.858 7,027
Surgery for malignancy 37 6.9 89,678 22,285 2.138 10,425
Urology 420 4.5 27,637 8,802 1.199 6,742
Vascular surgery 265 3.7 52,825 13,205 1.886 7,002
TOTAL 8,453 4.98 45,557 12,827 1.729 7,421
Also, the CMC hired a new Chief Executive Officer (CEO). The new CEO did an exhaustive analysis of CMC and his findings are highlighted in the textbook (Harrison, 2016, p. 13-16). Among other things, the CEO found no formal strategic planning process in place at either the CMC or the Coastal Healthcare Inc. levels.
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