Stefan Scholtes: Quality and productivity implications of separating routine elective care out of general hospitals

Quality and productivity implications of separating routine elective care out of general hospitals

General hospitals have to manage the conflicting operational requirements of routine patients, whose admissions are planned and whose services follow a priori specified standard treatment processes, and complex patients, whose admissions are unplanned and who may have complicating chronic conditions that interfere with standard procedures.

To overcome this tension, Clayton Christensen and colleagues have suggested replacing general hospitals with two types of organizations, “value-adding process clinics" for routine patients and “solution shop hospitals" for more complex patients. However, while a separation of routine care from general hospitals would allow these hospitals to reorganize as solution shops, any benefits from that reorganization may get eroded by the loss of scale when their routine patients are separated out.

I will present data from two studies of German and UK hospitals that suggests that this is not the case. It appears that a reduction of routine patients in general hospitals improves quality and reduces costs for the remaining non-routine patients. At the same time, routine patients themselves do benefit from scale, which can be achieved through a regionalization of these services. These patients also benefit from their hospital’s focus on the patient’s conditions. These studies provide empirical evidence for quality and profitability benefits of Christensen’s separation model for both routine and non-routine patients. 

Light luncheon refreshment will be provided at the beginning of this seminar.

Dr Stefan Scholtes 

Dennis Gillings Professor of Health Management at the University of Cambridge

Stefan Scholtes is Dennis Gillings Professor of Health Management at Cambridge University and a member of the Operations and Technology Management faculty at Judge Business School. Stefan studies healthcare from an operations management perspective, with a methodological focus on quantitative analyses of large patient-level datasets. He leads the healthcare activities of Judge Business School’s MBA and Executive Education programmes.