2 hospitals pin hopes on merger Outpatient centers more cost-effective in delivering services

Occupancy rates drop

Medical advances bring new methods of providing care

October 15, 1995|By Shirley Leung | Shirley Leung,SUN STAFF

Anne Arundel Medical Center and North Arundel Hospital once were the county's primary places for health care.

But advances in medical technology and health insurers' drive for cost-effective treatment have spawned outpatient centers for surgery, psychiatric treatment and routine care. Because of those changes, the two hospitals are considering a merger.

"Looking at the two health care systems in the county, we should be able to provide health care at a reduced cost and more effective manner," said James R. Walker, president of North Arundel. "We're very excited about this."

The occupancy rate at North Arundel in Glen Burnie has dropped from 76 percent in 1993 to 64 percent this year. The rates at Anne Arundel Medical in Annapolis have fluctuated from 60.5 percent in 1993 to 56 percent in 1994 and back to 60 percent this year, according to state and local statistics.

Statewide, occupancy rates have fallen from 64 percent to 60 percent in the past two years. No wonder then that during the same time, the Maryland Hospital Association reports that 15 of the 52 hospitals in the state have formed some kind of partnership to survive.

"The county health care system in 1990 is radically different" from today's, said Frances Phillips, Anne Arundel County health officer. "They do procedures that five years ago would have strictly been done in inpatient care."

Earlier this month, reports surfaced of a possible merger between Helix Health and Harbor Hospital Center, the third hospital serving the county.

"Market forces are making people think 'not hospitals,' " said Bill Dorrill, an administrator at the state health department's licensing and certification program. "Part of it is managed care, part of it is that the same procedures can be done as an outpatient, and some of it is doctors see that procedures can be done outside the hospital and take the fee for service for themselves."

In Anne Arundel, as elsewhere, the most visible competitor to hospitals are community-based outpatient surgical centers, where surgery can be performed as safely as in hospitals but at less cost, state health officials say.

At least a dozen such centers providing services ranging from podiatry to plastic surgery have opened in the county in the past decade, according to state health figures.

At Baltimore Washington Eye Center in Glen Burnie, administrators contend that cataract surgery can be done cheaper and more efficiently than at hospitals because the center focuses on a specialty.

"At the hospital, when do you have an opening? Three weeks? We control the setting. We control the time," said Philip Harrington, the eye center's administrator.

Cataract surgery at the center costs $880, about half the average hospital cost, Mr. Harrington said. The center's three ophthalmologists perform about 1,000 surgical procedures each year.

Lower costs are why more health maintenance organizations and insurers are referring clients to outpatient centers, said Camille Dobson, spokeswoman for the Maryland Association of HMOs.

Mary Harrington, a 58-year-old Linthicum resident who needed a colon examination, prefers going to an outpatient surgical center. Two weeks ago, she made her visit to the Arundel Ambulatory Center for Endoscopy in Annapolis.

Her appointment was at 9:15 a.m. By 11:15 a.m., she was ready to go home. The next day, she was back at her job as manager of Jonathan's restaurant in Baltimore.

"I was in and out," she said. "It's none of this 'Oh, I forgot you.' I felt anxious to get this done and over with. They made you feel at home."

Doctors express similar sentiments.

"Here my life is much easier. It's much more relaxed and we have the latest equipment," said Dr. Michael Epstein, who opened the endoscopic center in 1991 and is president of the Maryland Ambulatory Surgical Association.

Nancy Fiedler, spokeswoman for the Maryland Hospital Association, said that although ambulatory surgical centers often compete with hospitals, that won't be the case in the future.

"These pieces are going to come together again," Ms. Fiedler said. "That's the concept behind managing care and that's also

the best way to be cost-effective."

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