Unpredictable Demand and Low-Volume Hospitals background

This Findings Brief assesses the degree to which the annual number of patient discharges varies from year to year for low volume hospitals. To the extent that demand for inpatient services is unpredictable, it is hard for administrators to set budget and recruitment goals, which are generally based on estimates of future hospital business. We find that: Low volume facilities face considerably more instability from year to year in demand for inpatient services than larger hospitals. Average variability over time for the smallest facilities — those with 500 or fewer discharges per year — is nearly 60% higher than the average for all hospitals. Although low volume, rather than rurality, is the important factor, hospitals in very rural counties have to contend with substantially more fluctuation than other hospitals, primarily because they tend to be smaller