The future of regional hospitals is outpatient – thoughts on successful transformation

From regional hospital to outpatient centre – escape to the front or rescue in the greatest need?

Hardly anyone would dispute that the health care system is in a state of transformation. Digitalisation, from inpatient to outpatient, legal regulation, new market participants, medical progress, social changes, scarcity of resources and cost pressure – numerous, highly diverse dynamics are in the process of turning the industry upside down. It is difficult to predict where the journey is heading. What is clear: it is a structural change and those who wait too long will fall behind. What is equally clear: from a hospital’s point of view, a certain size is an advantage in this process. Higher patient volumes make it possible to have the necessary number of cases, make it easier to pay for certain services and offer more opportunities for cross-financing. In addition, there are economies of scale, which can be a decisive advantage, especially with regard to digital solutions.

Depending on the situation of a regional hospital, highly different reasons can justify an outpatient health centre. The transformation to an outpatient centre can be an alternative to successive closures, or it can serve as an innovation vessel and help prepare a currently well-positioned organisation for the future. In our projects we have encountered different arguments:

• Reduce costs by outsourcing the outpatient business to a more suitable (and thus less expensive) infrastructure.
• Ensuring high-quality medical care close to home
• Filling gaps in primary care and emergency care by general practitioners
• Building new business models and partnerships
• Organisational learning: how do outpatient operations work, for example?
• Gaining a strategic advantage over the competition

In addition, there is a great deal of uncertainty that can hardly be influenced: how will tariffs develop in the outpatient sector? Will the increase that some have been expecting for a long time come? In this context, the question also arises as to how the cantons will react if the hospitals increasingly invest in outpatient business models.

Dealing with risks, stakeholders and emotions

Planning an outpatient health centre stirs emotions, both positive and negative. Emotions tempt one to prefer shortcuts rather than going the extra mile, to believe things that fit into one’s own value system without closer investigation. Our project experience clearly shows: it is rarely as simple as first thought. A considered, prudent approach that takes into account all risks and interests is definitely worthwhile. A confusing, highly interdependent set of options for action and stakeholders makes for a complexity that should not be underestimated. Some things are universal in nature, others can be very different from case to case. We are regularly confronted with the following issues:

• From the perspective of the population, a nearby hospital, especially one with emergency facilities, conveys a sense of security. In addition, the average citizen often does not know exactly what is actually offered and how this differs from the planned outpatient health centre. A reduction of health services does not find majorities in Switzerland. Those who do not seek dialogue with foresight risk political shipwreck.
• From the point of view of the referring physicians, an outpatient health centre also means a certain amount of competition. How can the project be realised without jeopardising the vital relationship with the referring physicians in the region?
• Employees fear for their jobs or that they will have to work at a new location in the future. They also know that an outpatient centre tends to need fewer staff than a hospital with 24/7 inpatient care. Specialised staff who work in the outpatient centre are short in the hospital during this time. In addition, not every person who has worked in an inpatient setting will like working in the new centre. All this cannot be explained away. The sooner the staff have clarity about their professional future, the better. A signed contract is worth more than a thousand promises.
• Which services will take place at which location in the future? The existing inpatient infrastructure is often not suitable for the operation of an outpatient centre. Too large, historically grown, unsuitable for outpatient processes, at the wrong location. What happens with the space that becomes available in the existing hospital? A change of use is not easy to realise, it costs money and the path to achieving this can be filled with legal hurdles.

These challenges affect all outpatient health centres to various degrees. For all the opportunities, there is a strategic risk. It is necessary to find out which services generate which costs and revenues in which quantity and with which probability. It is necessary to assess which offers are mutually beneficial, how much free space is needed for growth and how this growth can in turn be strategically controlled. The good news is that the complexity can be managed. But it takes a lot of work.

Vision, service planning, partner network, stakeholder conversation, and back to square one. An iterative approach to getting closer to the ideal outpatient centre.

The conception and planning of an outpatient centre confronts one with large amounts of different information. Qualitative, quantitative, objective and subjective data and assessments, from experts and non-experts, from internal and external sources. Some have to be gathered with great efforts, others are simply there, whether you want them or not.  Some are complete, fit together and can be added up in a model. Most, however, are so different in structure and quality that they cannot be combined into a clear result. In short, trying to process all these inputs at once is doomed to failure. Working through the issues serially will not do justice to the complexity of the project and will inevitably lead to moderately useful results.

An iterative approach in carefully planned learning loops is more promising. Starting from a rough target picture, further informations are taken into account and the structure of the outpatient centre is developed gradually. As an example, the medical offer in the centre is revised several times. With each revision, the certainty of doing the right thing also increases. The following structure gives an overview of which phases such a project typically goes through.

Phase 1: Preliminary study / rough concept. The aim here is to sharpen the vision and to define the playing field for realising this vision, reducing the number of valid options for action. It makes sense to quantify different options for the outpatient health centre that seem realistic, so that all those involved can develop a feeling for the size of the project in terms of patient volume, space requirements and finances.

Phase 2: Study / detailed concept. The rough drafts from phase 1 are specified and examined in detail. This means, on the one hand, increasing the level of detail and, on the other hand, holding concrete discussions with the various stakeholders.

Phase 3: Implementation planning. Now it starts to get specific. It has to be clarified how the operative business, the strategic development and the financing of the outpatient health centre will work exactly. This also includes coordinating the architectural planning and the IT concept with the services and processes or clarifying procurement matters.

Phase 4: Realisation. The actual implementation: from construction to recruitment and commissioning to marketing. In this phase, the planning is put into practice and the outpatient health centre starts operating.

Our project experience shows that there are a number of success factors along this process – without claiming to be complete.

• Clarify the why and develop a common, communicable vision. There are a thousand reasons for and against an outpatient health centre or a specific offer in it. Having clarity about why you want to do something is the basic prerequisite.
• Create transparency with regard to case numbers, services and quality, both from an internal and market perspective. This also includes recognising blind spots.
• Continuously review and detail the business case and, above all, be aware of its weaknesses and uncertainties.
• Involving stakeholders proactively means involving politicians, the population, health care providers in the region and complementary providers (from homecare to day care centers) at an early stage. Advisable ist to stay on top of things throughout the entire project and following a plan. Because if you don’t plan, you react. And those who react are practically always one step behind. A constant exchange helps to defuse false expectations, fears and rumours. Otherwise, the energy generated in the change process can be bundled into massive political resistance.
• Understand the needs of patients, staff, referring physicians and politicians and create added value for them. If you want to take an entrepreneurial risk and inspire people to change, you have to show what will be better for each individual party.
• Giving courage and confidence in a balanced way. There is always someone who says “that won’t work”. Those who deviate from the ideal image at the first resistance have achieved nothing in the end.

Planning and realising an outpatient health centre is a challenge. A systematic approach ensures that the factors that can be influenced remain under control and that the risks in the overall project are manageable. In the next few years, there will be numerous other examples, both successful examples and problem cases alike.

Are you also in the process of planning an outpatient health centre? Have you had the same experiences as we have? Where do we have our blind spots? We welcome any exchange on the topic!