Our hospitals also face extreme competition in their efforts to recruit and
retain physicians on their medical staffs. It is widely recognized that the U.S.
has a shortage of physicians in certain practice areas, including primary care
physicians and specialists such as cardiologists, oncologists, urologists and
orthopedists, in various areas of the country. This fact, and our ability to
overcome these shortages, is directly relevant to our growth strategies because
cardiologists, oncologists, urologists and orthopedists are often the physicians
in highest demand in communities where our hospitals are located. Larger
tertiary medical centers are acquiring physician practices and employing
physicians in some of our communities. While physicians in these practices may
continue to be members of the medical staffs of our hospitals, they may be less
likely to refer patients to our hospitals over time.
We believe other key factors in our competition for patients is the quality of our patient care and the perception of that quality in the communities where our hospitals are located, which may be influenced by, among other things, the technology, service lines and capital improvements made at our facilities and by the skills and experience of our non-physician employees involved in patient care.
In order to achieve growth in patient volumes, revenues and profitability given the competitive and structural environment, we continue to focus our business strategy on the following:
· Measurement and improvement of quality of patient care and perceptions of such
quality in communities where our hospitals are located;
· Targeted recruiting of primary care physicians and physicians in key
· Retention of physicians and efforts to improve physician satisfaction,
including employing a greater number of primary care physicians as well as
physicians in certain specialties;
· Retention and, where needed, recruitment of non-physician employees involved in
patient care and efforts to improve employee satisfaction;
· Targeted investments in new technologies, new service lines and capital
improvements at our facilities;
· Improvements in management of expenses and revenue cycle;
· Negotiation of improved reimbursement rates with non-governmental payors;
· Strategic growth through acquisition and integration of hospitals and other
healthcare facilities where valuations are attractive and we can identify opportunities for improved financial performance through our management or ownership; and
· Developing strategic partnerships with not-for-profit healthcare providers to
achieve growth in new regions.
As part of our ongoing efforts to further manage costs and improve the results of our revenue cycle, we have entered into agreements with a third party to provide certain nonclinical business functions, including payroll processing, supply chain management and revenue cycle functions. We believe this model of sharing centralized resources to support common business functions across multi-facility enterprises provides us efficiencies and is the most cost effective approach to managing these nonclinical business functions. We fully implemented our payroll processing function in 2011. We expect to complete the implementations of the supply chain management and revenue cycle functions over the next 9 to 15 months.