Bright Roads Health System is an integrated delivery system (IDS) that has been in existence for just over six decades. The system is located in a large southwest Texas city. The Texas economy has really benefited from President Trump's tax reform measures and deregulation. No state income tax, tax abatements (TX Tax Code 312), reasonable cost of living, and plenty of activities for families and singles have also contributed to the attractiveness of Texas. Bright Roads leadership team is pleased to see that neighboring towns are focusing on their economic development, which is bringing new businesses to the region. In turn, this is stimulating new residential and commercial construction and an increasing need for infrastructure to support anticipated population growth. Part of that infrastructure includes healthcare and related industries.

Bright Roads wants to take advantage of this economic development and has been toying with the idea of building a micro-hospital in a nearby town that is anticipating a 30% growth in its' resident population over the next 5 to 8 years. This will ultimately bring the population density to 50,000. Like many IDS models, Bright Roads has seen a decline in their patient service revenue due, in part, to declining inpatient admissions, shorter average lengths of stay (ALOS), lower case mix index (CMI), declining reimbursement from governmental payers, and a tendency for patients to put off elective surgical procedures. There are several alternatives under consideration that will need to:

1. Expand the system's market share;
2. Meet the current and future healthcare needs of a new community;
3. Positively contribute to the financial position of the system; and
4. Align well with the existing business structure and model.

You are a member of a 10 member exploratory task force that has been charged by the Chief Operating Officer, Ms. Stephanie Smith, to investigate alternatives, and then make a recommendation on those alternatives that are deemed worthy of more in-depth consideration. To save time, the Chair of the task force, Ms. Danielle O'Rourke, Director of Strategic Initiatives, has asked you to take a look at micro-hospitals using the objectives:

Expand the system's market share.

Meet the current and future healthcare needs of a new community.

Positively contribute to the financial position of the system.

Align well with the existing business structure and model

Answer rating: 100% (QA)

Based on the objectives provided exploring the potential of building a microhospital in the nearby town experiencing population growth seems promising Microhospitals can expand market share by providi... View the full answer