Commentary: Health Care Industry Revolves around Money

By Hupfeld, Stanley | THE JOURNAL RECORD, May 3, 2001 | Go to article overview

Commentary: Health Care Industry Revolves around Money


Hupfeld, Stanley, THE JOURNAL RECORD


I have seen the future of health care along the gleaming streets and expressways of a high-toned Dallas suburb.

Recently I drove through the Las Colinas district near Dallas, whizzing by mile after mile of manicured grass. Part of the city of Irving, Las Colinas began as an ambitious development in the early 1980s - originally envisioned as a grandiose project with monorails and canals.

Those dreams disappeared after the oil bust. But developers still managed to lure luxury hotels and businesses (Oprah favorite Phil McGraw keeps his offices in the district). Today, Las Colinas stands as a crème de la crème collection of shining office buildings, gated communities, boutique shops, exclusive golf clubs, hotel towers and haute-cuisine restaurants - even boasting a movie soundstage and its own symphony orchestra.

One might consider it the Palm Beach of Dallas.

As I motored through the district, I happened to pass by a large building bearing the Baylor Health System logo.

The sign on the front indicated it was an outpatient surgical facility that included requisite urgent care and 24-hour obstetrics offerings.

But the sign meant that this large, impressive building offered no inpatient services. Consider it the post-modernization of health care.

The experience caused me to think of the construction of Integris Health's new hospital in Yukon, which has a heavy emphasis on outpatient care. I was struck by how far the health care industry has evolved from the early part of my career.

At that point, in the '70s and '80s, outpatient care in a hospital was pretty much an afterthought. After planning for development of inpatient services, if there was money left over, health care organizations might include some outpatient services.

In this era, we might now ask what would drive such a remarkable change in a relatively short period of time.

The answer is deceptively simple. One of my old health care administration professors used to instruct his students plainly, Remember, form follows prepayment.

By this he meant that all facilities and services would be developed where there are established insurance payments to cover care. When I began my career in health care administration in the early '70s, insurance was inpatient oriented.

In fact, I remember patients having their molars removed, then staying two or three days in a hospital. If hospitals and doctors were going to get insurance companies to pay, care had to be delivered in an inpatient setting. During the same era, psychiatric and drug rehabilitation facilities flourished. Then government reimbursement dried up, and many of these facilities disappeared.

But money isn't the only driving force for change. …

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