The Impact of Two Managerial Responses on Hospital Occupancy Crises

Abstract

Managers can respond to an occupancy crisis in two ways: take urgent action to minimize harm from the current crisis (urgent response), and invest in actions to prevent future occurrences (prevention response). To compare the effectiveness of these two responses, we study a large academic hospital that frequently experiences occupancy crises. For the urgent response, which is mandated by the state, physicians receive a text message alerting them of the crisis, and asking them to focus on discharging patients. For the prevention response, physicians can fill out a pre-discharge order (PDO) for a patient nearing discharge. PDOs are visible to the care team and therefore enable coordinated efforts to prevent discharge delays. We find that the state-mandated urgent response has no effect on inpatient length of stay. After accounting for endogeneity, the prevention response is associated with a 28.1% reduction in inpatient length of stay. Furthermore, when the hospital activates the urgent response, physicians are 4.8% less likely to use a PDO. We conduct counterfactual analyses to show that rather than responding urgently after occupancy reaches a crisis, managers should instead proactively change process to enable easy use of PDOs, which could prevent occupancy crises from occurring.

Keywords: Coordination, Health Information Technology, Health Care, Empirical Operations