D223 Task 1 Healthcare Organization Analysis Example

Healthcare Organization Analysis Using American Hospital Directory Data: A 240-Bed Nonprofit Community Hospital and Its Nearest Neighbor

Student Name

Leavitt School of Health, Western Governors University

D223: Healthcare Policy and Economics, Task 1

Course Instructor

Month Day, Year

Healthcare Organization Analysis Using American Hospital Directory Data: A 240-Bed Nonprofit Community Hospital and Its Nearest Neighbor

Selected Healthcare Organization

The organization selected from the American Hospital Directory (AHD) is a nonprofit community hospital of 240 beds, a composite referred to here as Lakeside Community Hospital, located in a mid-sized city in the Midwest. It offers emergency, medical-surgical, intensive care, obstetric and outpatient surgical services and serves as the main hospital for a three-county area. The AHD profile provides its facility type, type of control, Medicare utilization and financial data drawn from cost reports, which form the basis of this analysis (American Hospital Directory, 2025).

Significance of the Organization

Lakeside matters to me because it is where I began my nursing career as a new graduate on the medical-surgical unit and where my parents receive their care. I have seen its strengths from the inside, including a strong nurse residency program and an emergency department that is often praised by patients, and its struggles, such as long waits for inpatient beds during winter and frequent turnover of travel nurses. Analyzing it as an organization rather than as a workplace lets me connect what I see at the bedside to the finances and quality measures that shape decisions made far above the unit.

Type of Facility and Type of Control

The AHD lists Lakeside as a short-term acute care hospital. This means it treats patients with acute illnesses and injuries for relatively short stays, is paid by Medicare mainly through the inpatient prospective payment system, and is classed under federal Medicare rules as a general hospital rather than a specialty, long-term or critical access facility. Its services match that category: emergency care, surgery, obstetrics and inpatient medical care, with patients transferred to a tertiary center for cardiac surgery and major trauma.

Its type of control is voluntary nonprofit, church affiliated. The hospital is owned by a nonprofit corporation and governed by a board, receives federal tax exemption and in return must provide community benefit, including a financial assistance policy and, on a three-year cycle, a formal study of local health needs. Surplus revenue is reinvested in the hospital rather than paid to shareholders, which shapes decisions about capital spending and services that lose money, such as obstetrics.

Overall Star Rating and Additional Quality Source

On Care Compare, Lakeside holds an overall star rating of three out of five stars. The rating summarizes performance across five measure groups: mortality, safety of care, readmission, patient experience and timely and effective care (Centers for Medicare and Medicaid Services [CMS], 2024). A three-star rating places the hospital near the national middle. Looking beneath the summary, the composite profile shows mortality and safety of care close to the national average, readmissions slightly worse than average, and patient experience scores below average, particularly for communication about medicines and for quietness at night. CMS revised its methodology in 2021, and critics have noted that a single star rating can hide wide variation between measure groups, which is why the groups themselves should be read (Bilimoria & Barnard, 2021).

The additional quality source is the Leapfrog Hospital Safety Grade, which focuses on preventable errors, injuries and infections (The Leapfrog Group, 2025). Lakeside's composite grade is a B, with strong scores for hand hygiene and medication ordering and weaker scores for falls with injury and for nursing workforce measures. Together the two sources suggest a hospital that performs adequately on clinical outcomes but struggles with the parts of care most closely tied to nursing presence: communication, falls and readmission after discharge.

Financial Comparison With a Nearby Organization

The nearby organization for comparison is a composite 180-bed proprietary hospital 15 miles away, referred to here as Valley Regional Medical Center, also classified as a short-term acute care hospital. The comparison uses the same cost report year and measures for both. In the illustrative profiles, Lakeside reports total patient revenue of about $1.62 billion in gross charges and Valley Regional about $1.41 billion. Gross charges overstate what hospitals collect, so net patient revenue is the more useful measure: roughly $412 million for Lakeside and $318 million for Valley Regional. Medicare accounts for about 44% of inpatient days at Lakeside and 38% at Valley Regional, and Medicaid for 21% and 12% respectively.

Uncompensated care and operating margin complete the picture. Lakeside's illustrative profile reports charity care and bad debt of about $19 million, close to 5% of net patient revenue, against about $7 million at Valley Regional. Lakeside's operating margin is thin at roughly 1.8%, while Valley Regional's is closer to 6%. A margin that small leaves Lakeside little room to absorb a bad winter, a rise in agency staffing costs or a cut in Medicaid rates, and it explains why capital projects such as replacing aging telemetry monitors have been delayed two years in a row.

These differences reflect ownership and mission. As a nonprofit with obligations to the community, Lakeside carries more Medicaid patients and more uncompensated care, which lowers its margin even though it has higher revenue. Valley Regional, a for-profit hospital, serves a better insured population and has closed its obstetric unit, which improved its finances but sends mothers to Lakeside. For nurses, the comparison explains why Lakeside works with tighter staffing budgets despite being the larger hospital, and why decisions about which services to keep are made with an eye on payer mix as well as need.

Data Sources to Inform Organizational Transformation

One financial data source any healthcare organization can use for transformation is the Medicare cost report, which hospitals submit to CMS each year and which is publicly available through the Healthcare Cost Report Information System. Cost reports show costs, revenue, payer mix, uncompensated care and staffing by department, so a leader can compare the organization with similar hospitals and see where costs are out of line. At Lakeside, cost report data could show whether spending on travel nurses has risen faster than at peer hospitals and support the case for investing in retention.

One quality data source is the Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) survey, reported on Care Compare, which measures patients' experience of communication with nurses and doctors, responsiveness, discharge information and the hospital environment (CMS, 2024). Because HCAHPS results are broken down by topic, they point to specific changes. Lakeside's weak scores on communication about medicines, for example, suggest a practical target: a standard teach-back approach for new medications, measured by the next quarter's HCAHPS results.

Conclusion

Looking at Lakeside through its directory profile, its quality ratings and its finances shows a hospital doing a public job on a narrow margin. It is a nonprofit short-term acute care hospital with middling overall quality, weaker results on the measures most sensitive to nursing, and a payer mix that brings in less money per patient than its for-profit neighbor. Those facts point toward transformation that is practical rather than dramatic: using cost report data to control agency spending and fund retention, and using patient experience data to target specific nursing practices such as medication teaching. For a nurse, the lesson is that quality and finance are measured on the same patients, and improvements in one often depend on decisions made about the other.

References

American Hospital Directory. (2025). Hospital profiles: Free hospital data. https://www.ahd.com

Bilimoria, K. Y., & Barnard, C. (2021). An evolving hospital quality star rating system from CMS: Aligning the stars. JAMA, 325(21), 2151-2152. https://doi.org/10.1001/jama.2021.6946

Centers for Medicare and Medicaid Services. (2024). Overall hospital quality star rating. Care Compare. https://data.cms.gov/provider-data/topics/hospitals/overall-hospital-quality-star-rating

The Leapfrog Group. (2025). Leapfrog Hospital Safety Grade. https://www.hospitalsafetygrade.org