The battle between hospital groups and outpatient groups as activity shifts out of hospitals
Across Europe and beyond an increasing amount of surgical activity which formerly took place in hospital settings and required an overnight stay is being moved outside of hospitals.
This trend is “the single most important structural force in the sector currently,” according to Marc Kitten, Partner at healthcare consultancy Candesic, and is “quietly dissolving the hospital as the unit of care”.
Some countries are more advanced in this shift than others, due to differences in incentive (reimbursement) structures and differences in the way health systems are set up. But the shift is happening everywhere, and being led by private operators seeking to capitalise on a more cost-efficient way to deliver care.
Guillaume Duparc, Partner at consulting firm L.E.K. Consulting, believes that everywhere where additional surgical capacity is needed the majority of it will likely be out-of-hospital capacity. And much of this is will come from private operators.
But whether privately delivered out-of-hospital surgery becomes dominated by hospital groups setting up out-of-hospital clinics or by pureplay outpatient groups is yet to be determined.
“Hospitals have the surgery — including day surgery — experience, but out-of-hospital providers have stronger referral engines, more experience developing networks, and tend to be more agile,” Duparc notes.
Both single specialty and multi-specialty outpatient groups focused on high volume activity also have the advantage of being more horizontally scalable, and a much easier time expanding into multiple countries (see for example our interview with Bergman Clinics).
On the other hand hospital groups providing outpatient care can sell this as part of a fully-integrated offering covering the full patient pathway, as Ramsay Sante is attempting to do in France. “The winning model is no longer a standalone hospital but a local network — acute site, day-surgery centres, outpatient clinics, diagnostics and a digital front door — built around population density,” Kitten says.
This area will increasingly be a “battleground” between hospital groups and pureplay out-of-hospital providers.
HBI Intelligence subscribers can read our updated Marker Overview for Europe’s for-profit hospital sector.
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