Kenan W. Yount, MD MBA under the supervision of Michael J. Schill, PhD The Darden School of Business, University of Virginia A midsize (650-bed) community not-for-profit hospital, located in south...

Kenan W. Yount, MD MBA under the supervision of Michael J. Schill, PhD

The Darden School of Business, University of Virginia

A midsize (650-bed) community not-for-profit hospital, located in south central Virginia, chose an expansion strategy in 2008 by bringing all its cardiology under one roof in a new comprehensive care center. Impressive results drew the attention of several insurers who approached Cavalier Hospital, each hoping to include the hospital in its network of physician providers. In preparation for his first board meeting, the physician director wanted to assess the hospital’s overall financial condition to determine which strategies should be pursued next: focusing on acquiring patient volume, expanding investment into integrated care, setting the reimbursement structure for revenue collection, or moving to a capitation-based payment system. The evaluation of revenue models would help him understand which alternatives could best be supported for the business strategy.