A taxonomy of health networks and systems: bringing order out of chaos. (1/39)

OBJECTIVE: To use existing theory and data for empirical development of a taxonomy that identifies clusters of organizations sharing common strategic/structural features. DATA SOURCES: Data from the 1994 and 1995 American Hospital Association Annual Surveys, which provide extensive data on hospital involvement in hospital-led health networks and systems. STUDY DESIGN: Theories of organization behavior and industrial organization economics were used to identify three strategic/structural dimensions: differentiation, which refers to the number of different products/services along a healthcare continuum; integration, which refers to mechanisms used to achieve unity of effort across organizational components; and centralization, which relates to the extent to which activities take place at centralized versus dispersed locations. These dimensions were applied to three components of the health service/product continuum: hospital services, physician arrangements, and provider-based insurance activities. DATA EXTRACTION METHODS: We identified 295 health systems and 274 health networks across the United States in 1994, and 297 health systems and 306 health networks in 1995 using AHA data. Empirical measures aggregated individual hospital data to the health network and system level. PRINCIPAL FINDINGS: We identified a reliable, internally valid, and stable four-cluster solution for health networks and a five-cluster solution for health systems. We found that differentiation and centralization were particularly important in distinguishing unique clusters of organizations. High differentiation typically occurred with low centralization, which suggests that a broader scope of activity is more difficult to centrally coordinate. Integration was also important, but we found that health networks and systems typically engaged in both ownership-based and contractual-based integration or they were not integrated at all. CONCLUSIONS: Overall, we were able to classify approximately 70 percent of hospital-led health networks and 90 percent of hospital-led health systems into well-defined organizational clusters. Given the widespread perception that organizational change in healthcare has been chaotic, our research suggests that important and meaningful similarities exist across many evolving organizations. The resulting taxonomy provides a new lexicon for researchers, policymakers, and healthcare executives for characterizing key strategic and structural features of evolving organizations. The taxonomy also provides a framework for future inquiry about the relationships between organizational strategy, structure, and performance, and for assessing policy issues, such as Medicare Provider Sponsored Organizations, antitrust, and insurance regulation.  (+info)

Managing hospitals in turbulent times: do organizational changes improve hospital survival? (2/39)

OBJECTIVE: To examine (1) the degree to which organizational changes affected hospital survival; (2) whether core and peripheral organizational changes affected hospital survival differently; and (3) how simultaneous organizational changes affected hospital survival. DATA SOURCES: AHA Hospital Surveys, the Area Resource File, and the AHA Hospital Guides, Part B: Multihospital Systems. STUDY DESIGN: The study employed a longitudinal panel design. We followed changes in all community hospitals in the continental United States from 1981 through 1994. The dependent variable, hospital closure, was examined as a function of multiple changes in a hospital's core and peripheral structures as well as the hospital's organizational and environmental characteristics. Cox regression models were used to test the expectations that core changes increased closure risk while peripheral changes decreased such risk, and that simultaneous core and peripheral changes would lead to higher risk of closure. PRINCIPAL FINDINGS: Results indicated more peripheral than core changes in community hospitals. Overall, findings contradicted our expectations. Change in specialty, a core change, was beneficial for hospitals, because it reduced closure risk. The two most frequent peripheral changes, downsizing and leadership change, were positively associated with closure. Simultaneous organizational changes displayed a similar pattern: multiple core changes reduced closure risk, while multiple peripheral changes increased the risk. These patterns held regardless of the level of uncertainty in hospital environments. CONCLUSIONS: Organizational changes are not all beneficial for hospitals, suggesting that hospital leaders should be both cautious and selective in their efforts to turn their hospitals around.  (+info)

The prevalence of hospital health promotion and disease prevention services: good news, bad news, and policy implications. (3/39)

In recent years, American health care has shifted toward an emphasis on population health in communities. National data from the American Hospital Association Annual Survey of Hospitals are used to describe the prevalence of 26 services provided by general hospitals that could contribute to health promotion and disease prevention (HPDP). Cross-sectional descriptive analyses, based on national data sources, linked HPDP services to hospital characteristics, and factor analysis identified significant categories of HPDP activities. The results showed that many specific HPDP services are offered by thousands of hospitals, but prevalence, distribution, and availability of the services are uneven across the size and ownership of hospitals and their communities. Policy initiatives could increase the prevalence of hospitals' health promotion and disease prevention services, thereby improving the health status of their communities.  (+info)

Community orientation in hospitals: an institutional and resource dependence perspective. (4/39)

OBJECTIVE: To conceptualize community orientation-defined as the generation, dissemination, and use of community health-need intelligence-as a strategic response to environmental pressures, and to test a theoretically justified model of the predictors of community orientation in hospitals. DATA SOURCES: The analysis used data for 4,578 hospitals obtained from the 1994 and 1995 American Hospital Association (AHA) Annual Survey and the 1994 Medicare Hospital Cost Report data sets. Market-level data came from the Area Resource File. STUDY DESIGN: Multiple regression analysis was used to examine the effects of hospital size, dependence on managed care, ownership, network, system and alliance memberships, and level of diffusion of community-orientation practices in the area on the degree of community orientation in hospitals. The model, based on Oliver's (1991) framework of organizational responsiveness to environmental pressures, controlled for the effects of industry concentration and lagged profitability. PRINCIPAL FINDINGS: Degree of community orientation is significantly related to hospital size; ownership; dependence on managed care; and membership in a network, system, or alliance. It is also significantly related to the diffusion of community-orientation practices among other area hospitals. CONCLUSIONS: Degree of community orientation is influenced by the nature of environmental pressures and by hospital interests. It is higher in hospitals that are large, nonprofit, or members of a network, system, or alliance; in hospitals that are more dependent on managed care; and in hospitals that operate in areas with higher diffusion of community-orientation activities.  (+info)

Hospital registered nurse shortages: environmental, patient, and institutional predictors. (5/39)

OBJECTIVE: To examine the characteristics of acute-care hospitals that report registered nurse shortages when a widespread shortage exists and when a widespread shortage is no longer evident. DATA SOURCE: Secondary data from the American Hospital Association's Nursing Personnel Survey from 1990 and 1992 were used. The study population was all acute-care hospitals in the United States. STUDY DESIGN: Outcome variables included whether a hospital experienced a shortage in 1990, when many hospitals reported a nursing shortage, or whether a hospital reported a shortage in both 1990 and 1992. Predictor variables included environmental, patient, and institutional characteristics. Associations between predictor and outcome variables were investigated using probit analyses. PRINCIPAL FINDINGS: Location in the South, a high percentage of nonwhite county residents, a high percentage of patients with Medicaid or Medicare as payer, a higher patient acuity, and use of team or functional nursing care delivery consistently predicted hospitals reporting shortages both when there was a widespread shortage and when there was no widespread shortage. CONCLUSIONS: Although some characteristics under the direct control of hospitals, such as nursing care delivery model, are associated with their reporting a shortage of nurses, shortage is also strongly associated with broader population characteristics such as minority communities and a public insurance payer mix. Awareness of these broader factors may help inform policies to improve the distribution of nurse supply.  (+info)

Is managed care leading to consolidation in health-care markets? (6/39)

OBJECTIVE: To determine the extent to which managed care has led to consolidation among hospitals and physicians. DATA SOURCES: We use data from the American Hospital Association, American Medical Association, and government censuses. STUDY DESIGN: Two stage least squares regression analysis examines how cross-section variation in managed care penetration affects provider consolidation, while controlling for the endogeneity of managed-care penetration. Specifically, we examine inpatient hospital markets and physician practice size in large metropolitan areas. DATA COLLECTION METHODS: All data are from secondary sources, merged at the level of the Primary Metropolitan Statistical Area. PRINCIPAL FINDINGS: We find that higher levels of local managed-care penetration are associated with substantial increases in consolidation in hospital and physician markets. In the average market (managed-care penetration equaled 34 percent in 1994), managed care was associated with an increase in the Herfindahl of .054 between 1981 and 1994, moving from .096 in 1981 to .154. This is equivalent to moving from 10.4 equal-size hospitals to 6.5 equal-sized hospitals. In the physician market place, we estimate that at the mean, managed care resulted in a 14 percentage point decrease of physicians in solo practice between 1986 and 1995. This implies a decrease in the percentage of doctors in solo practice from 38 percent in 1986 to 24 percent by 1995.  (+info)

Reexamining organizational configurations: an update, validation, and expansion of the taxonomy of health networks and systems. (7/39)

OBJECTIVES: To (a) assess how the original cluster categories of hospital-led health networks and systems have changed over time; (b) identify any new patterns of cluster configurations; and (c) demonstrate how additional data can be used to refine and enhance the taxonomy measures. DATA SOURCES; 1994 and 1998 American Hospital Association (AHA) Annual Survey of Hospitals. STUDY DESIGN: As in the original taxonomy, separate cluster solutions are identified for health networks and health systems by applying three strategic/structural dimensions (differentiation, integration, and centralization) to three components of the health service/product continuum (hospital services, physician arrangements, and provider-based insurance activities). DATA EXTRACTION METHODS: Factor, cluster, and discriminant analyses are used to analyze the 1998 data. Descriptive and comparative methods are used to analyze the updated 1998 taxonomy relative to the original 1994 version. PRINCIPAL FINDINGS: The 1998 cluster categories are similar to the original taxonomy, however, they reveal some new organizational configurations. For the health networks, centralization of product/service lines is occurring more selectively than in the past. For the health systems, participation has grown in and dispersed across a more diverse set of decentralized organizational forms. For both networks and systems, the definition of centralization has changed over time. CONCLUSIONS: In its updated form, the taxonomy continues to provide policymakers and practitioners with a descriptive and contextual framework against which to assess organizational programs and policies. There is a need to continue to revisit the taxonomy from time to time because of the persistent evolution of the U.S. health care industry and the consequent shifting of organizational configurations in this arena. There is also value in continuing to move the taxonomy in the direction of refinement/expansion as new opportunities become available.  (+info)

Factors related to the provision of hospital discounts for HMO inpatients. (8/39)

Using 1986 AHA hospital survey data, we analyzed hospital-HMO contract provisions, hospital operating characteristics, and market conditions for a national sample of 801 hospitals with HMO contracts to determine the factors related to provision of a discount and the magnitude of the discount if present. Seventy-eight percent of the hospitals reported that at least one of their HMO contracts provided a discount for inpatient services. Risk-sharing provisions, the number of hospitals within a five-mile radius, the proportion of the population enrolled in HMOs, and the number of HMOs operating in the metropolitan statistical area (MSA) were directly related to provision of discounts. Public hospitals were less likely than other facilities to provide discounts. For the magnitude of the discounts, risk-sharing provisions and the number of hospitals within a five-mile radius were again related, as was the number of HMOs operating in the MSA--but this time the number-of-HMOs variable had an inverse relationship. The results suggest that increased HMO market activity does result in price competition for hospital services but that hospital discounting strategies are extremely complex and may not follow conventional market theories. Hospitals appear to be using contracts both to stabilize their relationships with HMOs and increase market share, and they are increasingly giving discounts to achieve those ends.  (+info)

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