Separate and Concentrate: Accounting for Patient Complexity in General Hospitals

Ludwig Kuntz (), Stefan Scholtes () and Sandra Sülz ()
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Ludwig Kuntz: Faculty of Management, Economics and Social Sciences, University of Cologne, 50931 Cologne, Germany
Stefan Scholtes: Judge Business School, University of Cambridge, Cambridge CB2 1AG, United Kingdom
Sandra Sülz: Erasmus School of Health Policy and Management, Erasmus University Rotterdam, 3062 PA Rotterdam, Netherlands

Management Science, 2019, vol. 67, issue 6, 2482-2501

Abstract: Scholars have recently suggested the reorganization of general hospitals into organizationally separate divisions for routine and non-routine services to overcome operational misalignments between the two types of services. We provide empirical evidence for this proposal from a quality perspective, using over 250,000 patient discharge records from 60 German hospitals across 39 high-mortality disease segments, and focusing on in-hospital mortality as outcome. Disentangling the effects of high, absolute, and relative hospital volumes in a disease group, our analysis suggests that routine and complex patients would benefit from a hospital organization with a multi-specialty hub for emergency and non-routine elective services at its core, complemented by organizationally separate disease-focused hospitals-within-hospitals for routine services. We also provide evidence that the hub hospital can further improve service quality for complex patients by adopting a disease-based rather than medical specialty-based departmental routing strategy for newly arriving patients. A counterfactual analysis, based on a simultaneous equations probit model that simultaneously controls for endogeneity of volume, focus, and routing strategy, suggests that the proposed reorganization could have reduced mortality in the sample by 13.43% (95% CI [6.87%; 18.95%]) for routine patients and by 11.67% (95% CI [6.13%; 16.86%]) for the most complex patients.

Keywords: healthcare management; hospital; patient complexity; volume; focus; routing; solution shop; value-adding process; service quality; mortality (search for similar items in EconPapers)
Date: 2019
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Citations: View citations in EconPapers (5)

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