Abbeville Area Medical Center, Abbeville, South Carolina
Like many small, rural families, Abbeville Area Medical Center (AAMC) faced an extremely challenging competitive environment.
Staying Alive
A 450-bed hospital just 15 miles away — and an even larger facility 30 miles in a different direction — lured patients to leave Abbeville County to seek care.AAMC,licensed for 52 beds,witnessed a steady decline in admissions, surgeries and overall market share.Moreover, with an aging facility from 1966 and equipment that was less than state-of-the-art, AAMC was unable to compete on a level playing field with the much larger hospitals nearby.
Decreasing volume made physician retention and recruitment all the more difficult and helped create a vicious cycle.As census shrank, the hospital lost an Ob-Gyn and a general surgeon (and their associated patient volume), which eroded AAMC’s competitive position even further.
When QHR’s relationship with AAMC began in 1993,the hospital’s short-term survival was in question.Barely a year earlier,AAMC had to borrow money from the county to make payroll.
“We were at a turning point. Our old hospital was built for inpatients, not for the outpatient services we need to compete today.We needed either a new hospital or to get out of the business. QHR provided expertise and guidance on building the new facility and securing the financing. I don’t know if we could have survived without QHR’s expertise,” says Board Chairman Harold Campbell.
With the help of QHR consultants in revenue cycle management,the hospital enjoyed immediate improvement. Other consultants in nursing,surgery,materials management, housekeeping,case management,home health and Joint Commission accreditation contributed to AAMC’s stabilization.Meanwhile,the on-site QHR management team provided much needed stability to a hospital that had witnessed frequent administrative turnover.
A Strategic Plan
Though the hospital had survived for the short term,its long-term future remained in doubt as its large competitors began expanding their own facilities and services — and drawing more patients away from Abbeville’s service area.
At board retreats in 2000 and 2001,QHR strategic planning consultants assembled all relevant demographic information,led a visioning process and helped the board reach consensus around a long-range plan to build a modern new facility.Then the on-site QHR team and consultants began the long process of assessing needs,obtaining support from the county and securing financing.Construction on the new facility began in 2004.
Shifting to Critical Access
The QHR team recognized a critical opportunity in the Medicare Modernization Act of 2004,which increased from 15 to 25 the maximum number of beds to qualify for designation as a critical access hospital (CAH). AAMC’s daily patient census,while averaging below 15 since 2000,often fluctuated above that threshold.
With the higher bed allowance,the QHR team helped the hospital win approval for the CAH designation.As a result,AAMC began receiving cost-based reimbursement, which helped improve the hospital’s financial position significantly.
Building Home Health
After Medicare’s interim payment system created a very difficult reimbursement environment,AAMC’s board struggled over the issue of whether to close the hospital’s home health agency.QHR consultants persuaded the board to wait until a new,prospective payment system took effect that would restore profitability to these services.The consultants also helped the hospital transition to the new system and market their home health services to area physicians.
Since that time,the hospital purchased and combined two other agencies and expanded its service area to five counties.With a patient base that has grown from 180 to 460,the hospital’s home health agency now generates nearly $1 million in net revenue each year.
“Expanding our home health services was an opportunity to diversify our market and provide more stability,”says CEO Alvin Hoover.Today,AAMC claims a larger market share for these services than either of its two large competitors.
New Facility, New Revenues, New Growth
In August 2006 — under budget and ahead of schedule — AAMC opened its new $13.7 million facility. The 67,000-square-foot hospital now includes an array of sophisticated capabilities that help AAMC compete more effectively:
- 2 state-of-the-art surgical suites for advanced procedures
- an outpatient surgery center that offers easier access, more personal care and reduced wait time
- 16-slice CT scanner and fully digital radiology and archiving systems an expanded emergency department
- 2 sleep study suites (based on a need and opportunity identified by the QHR team)
- a community wellness center
- a new,modern nursery
- specialized areas for neuro-diagnostics,inpatient physical therapy and stress testing
- wireless patient monitoring
AAMC also transitioned from its old name,Abbeville County Hospital,to reflect the changes in facility,design and patient care,and its commitment to patients throughout the entire Abbeville area.
Results
- Increased volume. In the first month after the new hospital opened,average daily patient census nearly doubled,to 12.5. Surgeries rose from 47 to 92,while arthroscopic procedures increased from 35 to 60. Previously these additional cases would have been lost to competitors.
- New physicians. Acting on a physician needs analysis prepared by QHR consultants,the hospital was able to recruit a new urologist and a second OB/GYN as a direct result of opening the new facility.
- Community impact. A new retirement community, with 375 homes in Phase I and another 350 in Phase II,is coming to Abbeville County,whose overall population is roughly 26,000.The developers of the new community told county officials that they would not have located in Abbeville County without the new hospital.
"Not many small,rural hospitals so close to major tertiary facilities can say they’re thriving,but we are. Now,our new facility makes us an even more vital part of Abbeville County’s economy and is helping attract new industry."
