Health care is not immune to changes in the economy.
In its “Reports on the Economic Crisis: Initial Impact on Hospitals” issued by the American Hospital Association last November, several startling trends were identified:
- Uncompensated care is increasing at the rate of 8 percent nationwide. Hospital operating margins are declining 1 percent or more on average. More than 31 percent of hospitals are already reporting moderate or significant decreases in admissions and elective procedures.
“The economic downturn has meant real pain for families and communities. For many, a pink slip also means losing vital health coverage and represents tough choices about the family budget,” said AHA President and CEO Rich Umbdenstock. “This report underscores those decisions as people put off needed health care, as well as the challenges hospitals face as they work to meet the needs of their community.”
Hospitals have seen the immediate impact of the economic downturn in other ways. According to the report, total margins fell to negative 1.6 percent in the 3rd quarter of 2008 versus positive 6.1 percent during the same period last year.
All of these pressures are leading to a decline in hospitals’ financial health, which could ultimately affect local economies.
“Hospitals are a critical part of our nation’s economy as the second largest private sector source of jobs,” noted Umbdenstock. “In addition, every dollar spent by a hospital supports more than $2 of additional business activity in a community. But cuts to Medicare and Medicaid may stunt hospitals’ ability to help drive economic growth. The economic crisis is taking its toll on patients, communities and hospitals alike.”
The full report is at AHA.org.
Filed Under: Clinical Improvement
Tags: AHA, better hospitals, Clinical Operations, Clinical processes operating room, Feature article, Labor Cost Management, operating room management
About the Author
Cary understands what it takes to make, “Better American Hospitals.” In addition to being a seasoned consultant, Cary has worked as interim hospital CMO in three different organizations, as well as served as medical director for two multi-specialty medical groups and several HMOs. Cary has a solid history of leading medical staff through improvements in utilization management, changes in peer review practices, and corrective action procedures. As President and Chief Operating Officer, Cary is armed with a diverse background in hospital, medical group, and managed care settings, and has immersed himself in developing the strong knowledge base and extraordinary skill set needed to successfully improve today’s hospitals.
While serving as a member of the American College of Physician Executives, Cary has used his deep knowledge of the complex structures of the healthcare field and applied it toward implementing quality improvement initiatives and developing governance structures, strong compensation plans, productivity reporting models, and effective physician management training programs. Prior to joining Compass Group, Cary provided a number of successful consultant services resulting in projects that included the effective merging of medical staff of two hospitals, reducing the length of stay at hospitals, decreasing inpatient utilization for managed care organizations in several markets, the successful turnaround of the financial performance of a Medicare PHO with full capitation, mentoring Chief Medical Officers, evaluating medical group capability for managing capitation, and improving operating room utilization. Cary continues to use his compelling interpersonal skills to maintain a strong focus on improving clinical operations, developing medical staff leadership, and strengthening physician relationships.
While Cary served on active duty in the U.S. Navy, he was Head of the Quality Assurance Department of the Navy Medical Command, National Capital Region, in Bethesda, Maryland. Cary is board certified and completed a laboratory medicine residency and an immunohematology fellowship at Washington University in St. Louis. In addition to his numerous national speaking engagements, he has authored a number of publications including, Hospital Service Recovery, Journal of Hospital Marketing and Public Relations.
Case studies to learn more about ways in which Compass Clinical has worked to create better American hospitals.