How Memorial Health System cut costs to better serve its community

Established in 1929, Memorial Health System (MHS) has a deep and rich history, much like the community it was founded in. For this small, two-hospital system in rural Ohio, health care isn’t just about "fixing" patients, it’s about providing meaningful care for the people it sees every day.

When declining reimbursements threatened MHS's financial position, it had two options: efficiently provide a fraction of its services under a larger health system or improve and steady its financial position. But in this community of 14,000 residents—nearly 20% of whom were over the age of 65—taking services away from the local hospital was not an option.

A three-part growth plan

MHS partnered with Advisory Board Consulting and strategically grew its market share by improving staff, surgical, and patient care efficiency.

Improved labor productivity, yielding $1.3M in savings

  • Established a labor management system to align staffing levels to volume
  • Redeployed staff to outpatient setting to keep pace with reimbursement shifts

Increased surgical volume by 10% without capital investment

  • Redesigned block scheduling to improve patient flow, surgeon experience, and utilization of assets
  • Took on seven new surgeons and allotted time block

Reduced average length of stay by 1,800+ days per year

  • Changed nursing care model to support top-of-license practice and accountable care
  • Eliminated inefficiencies in inpatient care delivery
  • Enhanced care management services to expand emergency department coverage

Increased savings, maintained existing service offerings

MHS was able to improve efficiency of its operations, more aggressively recruit physicians and surgeons, and grow its market share—adding up to $3 million in improvement.

In uncovering its potential to take on more patients, MHS increased volumes enough to continue offering a wide breadth of services, ensuring the community was able to access the care they needed, where they need it most—their hometown.

Memorial Health System received the 2015 Transformation Award for Hospital Performance Management. Watch the video

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