Abstract
As the population continues to age and Medicare continues to reduce inpatient reimbursement levels, the hospitalist practice model may enhance hospital performance and improve the allocation of inpatient resources. Data for this study were obtained from the 2001 AHA annual survey, the Area Resource File and the CMS Minimum Data Set. Descriptive statistics were evaluated and a logistic regression model was used to examine those organizations using the hospitalist model in contrast to those without. The study found that organizations using the hospitalist model are located in communities with higher HMO penetration, have more hospital beds, more clinical services, and more managed care contracts. In addition, organizations with the hospitalist model have higher occupancy rates, a higher return on assets, and a lower average length of stay. From a managerial perspective, this study clearly demonstrates the hospitalist model will improve efficiency and profitability. From a policy perspective, the hospitalist model will increase efficiency, reduce length of stay, and improve the allocation of resources within the inpatient hospital industry. The link between hospital profitability and the use of the hospitalist model suggests that this is a viable clinical approach to managing acute care in hospitals as a mechanism to improve financial performance and potentially quality of care.