Although neuroscience volumes have been one of the best areas of recent growth for hospitals, high growth for some procedures may not be sustained in future years. In fact, volumes for some neuroscience procedures are even predicted to decline in the hospital setting.
Across some services, the drop will result from a shift in site of service, migrating out of hospital settings. For example, the advent of portable sleep monitoring is pushing many hospital-based sleep services to the patient home. Even though total sleep study volumes are projected to increase 66% by 2020, hospital outpatient department (HOPD) volumes will decline by an estimated 12%.
Dampened growth an important consideration for neuroscience strategic plans
Although spine procedures are considered to be a bread and butter service of hospital business units, there are a number of challenges that will affect the pace at which these procedures are poised to grow in the future. The traditional growth drivers of the past, such as demographics and advances in technology, may actually temper growth in coming years. The utilization of certain spine procedures, spinal fusion in particular, may begin to slow as baby boomers continue to age—the utilization of spine surgery peaks between ages 45 and 64.
Advances in technology and treatment techniques may also reduce inpatient volumes by pushing procedures to outpatient settings (see the Marketing and Planning Leadership Council’s Service Line Forecast Compendium for inpatient and outpatient forecasts).
Commercial payers and government agencies are also increasing their scrutiny of spine surgery utilization, putting additional pressure on growth prospects. For example, CMS recently announced (and then postponed) plans to launch a demonstration in 11 states evaluating the appropriateness of high-end procedures, including common spine procedures, by conducting prepayment reviews to ensure medical necessity before providers are reimbursed. Such efforts, along with news coverage putting “unnecessary” utilization of spine procedures in the spotlight, are likely to push providers to offer more conservative therapies as penalties and denied payments increase.
Expanding spine services across the care continuum
Neuroscience service lines represent a comprehensive continuum of care—including neurological and neurosurgical services—that will be increasingly important as the population ages (the number of people over 65 is projected to grow 38% across the next decade). This demographic growth positions neurosciences as a strong future contributor to hospital financial performance, as prevalence rates of age-dependent neurologic conditions like stroke, movement disorders, and memory disorders are undergoing considerable growth.
According to the Advisory Board’s Inpatient Market Estimator, inpatient volumes for these services totaled 2.6 million in 2010 (approximately 7% of all inpatient volume). Neuroscience volumes are forecast to grow to 2.8 million in 2015, and approximately 3 million in 2020 (12% growth from 2010). Hospital outpatient department volumes are expected to grow from 3.3 million in 2010 to 3.5 million in 2015. Volume-wise, neuroscience service lines sit in the middle of the service line pack, but these service lines garner per case contribution profits that rival those of other specialties.
Indeed, the question that hospitals will face is not how to grow neuroscience volumes, but how to manage volumes of these increasingly complex populations.
The case for comprehensive neuroscience service lines