Healthcare site selection model

Understanding the 4 Primary Types of Healthcare Site Selection Models

As the healthcare industry continues to shift to a consumer-centric strategy, a growing number of providers are implementing site selection models to guide their real estate decisions. Real estate site selection models come with many unfamiliar terms, which can feel daunting to first time purchasers.

In this blog, we’ll explain the four most common types of healthcare site selection models so you can have more informed conversations with potential real estate partners. 

Healthcare Site Selection Model Type #1: Automated Site Score Model

What is it? An automated site score model is a theoretical model developed based on factors that are believed to influence performance for a specific healthcare service line, sub-service line, or facility type. The model may use variables such as area draw, supply of providers, demand, core consumer profile, and more. Because the model is theoretical and entirely pre-built, no actual patient data is required. 

What is the output of the model? Automated site score models produce an index score that tells you how a site’s potential for that service line or facility type compares to the average potential in the geographic area the model is calibrated to assess. If a score of 100 represents the average level of opportunity for the service line in that market, then a 120 score indicates the site has 20% more favorable characteristics than the average site. The site score sheet usually lists the individual variables that make up the overall score so you can see how it was derived.

Is it for me? Because automated site score models are pre-built, they can be used for organizations of all sizes and are the fastest models to implement. These models are popular with health systems who offer many specialties and need separate models for each, organizations who would prefer not to share data with an analytics vendor, and small specialty healthcare provider networks who are just beginning to grow their location count. 

Healthcare Site Selection Model Type #2: Enhanced Site Score Model

What is it? Like an automated site score model, an enhanced site score model is developed based on factors that are believed to influence performance for a specific healthcare service line, sub-service line, or facility type. However, it is customized with the addition of a consumer profile based on the organization's actual patient base and/or adjustments to model variables based on the organization's business model. Because the model is primarily theoretical, no location performance data is required and patient data is optional. Enhanced site score models have sometimes been referred to as "service line models," but can actually be developed for a range of service lines, sub-service lines, and facility types. 

What is the output of the model? Enhanced site score models produce an index score that tells you how a site’s potential for that service line or facility type compares to the average potential in the geographic area the model is calibrated to assess. The site score sheet usually lists the individual variables that make up the overall score so you can see how it was derived.

Is it for me? Because enhanced site score models are still largely theoretical and have few data requirements, they can be used for organizations of all sizes and are quicker to implement than fully custom model types. These models are ideal for healthcare organizations who want some input into model variables while keeping cost and data requirements low, health systems who offer many specialties and need separate models for each, and small specialty healthcare provider networks who are just beginning to grow their location count. 

Healthcare Site Selection Model Type #3: Benchmark Site Score Model

What is it? A benchmark model is developed “from scratch” based on factors that are proven to correlate with an organization’s unique performance for a specific service line, sub-service line, or facility type. The process begins with analyzing your patient data, identifying the profile of the primary type of consumers you serve, and calculating how far those consumers travel to visit your locations. From there, other factors – such as healthcare provider supply, healthcare demand, favorable cotenants, and more – are tested to identify the combination of variables that best explain performance.

What is the output of the model? A benchmark model produces an index score that compares the expected performance of a site to your existing sites based on the variables included in the model. The site score sheet usually lists the individual variables that make up the overall score, so you can dive deeper into understanding the site’s dynamics.

Is it for me? If you have 21-50 locations that 1) offer the service line being modeled or are of a single facility type, 2) have been open for at least a year, and 3) will share patient data, then a benchmark model is likely a great fit for you. This model type is popular with retail health and other specialty health organizations. Some health systems choose to use a benchmark model for their primary care locations but use automated or enhanced models for other specialties since those models don’t have minimum location count requirements. 

Healthcare Site Selection Model Type #4: Forecasting Site Score Model

What is it? A forecasting site score model is the most complex of the four site selection model types. It uses linear regression to provide a forecast for a specific performance indicator, such as number of visits or projected revenue. The forecasting model includes many of the same variables as the benchmark model but goes beyond the benchmark model by examining how your locations affect each other, which is referred to as “cannibalization.”

What is the output of the model? Unlike an automated, enhanced, or benchmark model, a forecasting model produces an actual performance forecast, such as 7,500 annual visits. Index scores and/or raw values for the underlying variables are usually provided.

Is it for me? Producing a statistically reliable forecast requires a large sample set of good quality location performance data. Healthcare providers with 51+ locations that 1) offer the service line being modeled or are of a single facility type, 2) have been open for at least a year, and 3) will provide location, patient and encounter data, typically have the data required to develop a forecasting model. For many health systems, a forecasting model may not fit based on the requirements, but it may be a great fit for a retail health or specialty health organization.

If you are looking for a partner who can help you make the right healthcare site selection decisions, consider working with Buxton. Explore our solutions for health systems and specialty health providers to learn more.

Journey Awareness Persona Strategy/Facilities Healthcare