Operational Assessment

A hospital operational assessment process involves the review and assessment of strategy, operations, staffing, supply chain, revenue cycle, finance, medical staff issues and facility leadership. 

An extensive review of data and documents begins the process. Other information gathering is completed through one-on-one interviews with individuals on the hospital’s board of directors, its management team, department directors and its medical staff.



  • The process is designed to help identify any opportunities that will ensure increased revenue and reduced costs. By looking at issues such as staffing, operations, supply chain, finance, and revenue cycle, we will point out areas that affect the performance and finances of the hospital. We will then work together with hospital management to come up with ways to improve cash collections and decrease expenses.
  • Part of the operational assessment process involves comparing the client hospital to similar hospitals in the surrounding area. By benchmarking to compare hospital performance, we reveal issues are specific to the facility and those that impact other hospitals as well. In the end, we will be able to make suitable recommendations on how to improve operations.
  • Through this analysis, we will be able to identify the vulnerabilities and goals of the organization. In this way, we will find the right ways to enhance operations and improve efficiency. The goal is to work with hospital management to ensure the risk of financial and performance crisis is minimized. In the end, the hospital will be on the path to achieving the primary goal of offering quality healthcare to patients.
  • A desktop evaluation and onsite assessment of the different business processes give a comprehensive view of the operations of the hospital. This is one of the best ways to establish the status and health of the facility.
  • Conducting an operational assessment provides a clear picture of current hospital performance. It also outlines a plan for implementation and follow through so that the hospital is firmly on the path to sustainability.

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CHC first conducted an intensive operations assessment and developed an action plan that quickly led to a $10 million gain. CHC then identified additional IT and supply chain savings totaling upwards of $15 million.
~Gary Looper, President and CEO, Memorial Health System of East Texas

Managing Hospital Operations More Important than Ever

Rising costs have made it more important than ever to evaluate and improve the operational efficiency of hospitals. While the primary objective of any hospital is to offer quality healthcare services to the surrounding community, hospital leaders must ensure that their financial health enables them to sustain and serve the community for many years to come. 

Another challenge hospitals face is grappling with diminishing cash reserves and declining patient volumes. In cases where those issues are not addressed, hospitals can find themselves in a financial and operational performance crisis. 

Operational assessment plays a critical role in ensuring that community hospitals run efficiently. Simply put, an operational assessment process detects challenges, identifies the root cause(s) for those challenges, and outlines a plan to make improvements. 

At Community Hospital Corporation, we carry out operational assessments to help identify areas where hospitals can reduce expenses and improve their net revenue. When testing the operational performance of any hospital, we focus on issues such as strategy, supply chain, operations, staffing, finance, revenue cycle, facility leadership, and medical staff issues. In this way, we work with the management to determine the status of the hospital objectively. Regardless of whether a medical facility is in distress or operating well, this process will help to enhance performance so the facility can achieve its goals.

Path to Sustainability

Operations and Expense Management. Before taking any action that is designed to improve the operational processes of any hospital, we will have to evaluate the current processes to identify weaknesses and strengths, and find opportunities to boost net revenue while reducing expenses. During the assessment, we will also compare hospital performance to similar hospitals in the same area and in other similar markets. For example, we look at productivity and supply costs  since we will want to establish whether the costs that the hospital incurs deliver value for money. In this way, we will recommend ways for the facility to avoid or improve financial performance.

Clinical Services. Our operational improvement services also focus on making sure the hospital offers a positive patient experience. We will work with both the management and clinical staff to streamline patient care and services. Often times we are able to work with hospitals to improve patient satisfaction scores and reduce the cost of providing care.

Medical Staff. The importance of the medical staff in any hospital cannot be overstated. During our operational assessment, we will assess hospital-physician relations to identify any issues or concerns. After all concerns are clear, we provide strategies to involve physicians to improve hospital performance, recruit physicians as needed and strengthen physician alignment, which can increase hospital utilization.

Finance. Awareness is the first step to improving financial performance, and that is one of the primary reasons why an operational assessment is so important for hospitals. Therefore, it goes without saying that the path to sustainability will involve looking at finances. The decisions and actions of the finance department have a direct impact on the cash flow of the hospital. During the evaluation, we will carry out an internal audit to establish whether there are any leakages when it comes to revenue collection or expense management.

Capital Issues. With the importance of advanced equipment and recent technology increasing, the capital requirements for running a hospital are significant. Deferred maintenance, delayed equipment upgrades and old technology all impact public perception and patient care. Setting a hospital on the path to sustainability will involve looking at capital requirements and determining how best to fund necessary investments.

Business Development and Strategy. It’s important to focus on growth opportunities as well. We will analyze the market for opportunities to expand services and increase market share. This analysis includes a deep dive into the demographics and dynamics in the hospital’s service area. This will also encompass creating a marketing strategy that will guide the hospital into the future. Other areas of focus include physician referral development, community relations, Website enhancement, social media and other marketing initiatives.