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Analysis of Market Share

Arbor Associates’ market share studies support clients’ planning processes by providing the most current share levels and trend analysis available. Findings are reported by product line as well as principal payment source.

Market Share by Community

By utilizing available statewide inpatient databases, the communities (zip codes) from which patients are admitted to the hospital can be identified. It is also possible to determine the number of patients discharged from other hospitals from each zip code. Analysis will performed at the DRG-specific level, including patients of all ages and payors. Results will be shown by DRG with aggregates by Major Diagnostic Category (MDC). The principal result of this analysis is to identify the hospital’s market share in each community. However, rather than calculate the percentage of all discharges from the service area irrespective of diagnosis, the analysis will focus only on those DRGs treatable at the hospital. By so doing, a set of true market share figures can be calculated which reflect the competitive position of the hospital and its medical staff for those services which are actually provided. These figures will be undiluted by discharges for services not provided which may include open-heart surgery, organ transplant, etc.

Potential for Additional Discharges

A second result of the Analysis of Market Share is the identification of additional potential discharges. These figures result from subtracting the number of discharges the hospital recorded for each treatable DRG from the total number of discharges for that DRG in the service area. These discharges represent potential additional patients which the medical staff and the hospital are already prepared to treat.

Potential for New Services

A third result of the Analysis of Market Share is to identify the DRGs not previously treated which have the highest potential volume and to rank them for possible development as new services.

Analysis by Payor

Finally, the analysis will permit a cross-reference of the data by principle payment source. This will result in a further prioritization among current and new lines of service according to those with the greatest potential volume and the best payor mix. Because the output of this part of the study is presented in terms which closely match certain physician specialties, it has direct application to the recruitment process as well. Possible enhancements to the Analysis of Market Share include multi-year trend analysis and the identification of the market share and payor mix of competing hospitals.

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