Is well underway. Likely impacts include:
- more hospitals shutting down their inpatient operations
- a decline (!!) in hospital employment
- even more aggressive land-grab efforts by rival health systems seeking highly profitable commercially insured patients (that’s you, dear reader)
- doubling down on “revenue maximization” (that’s you, work comp payor)
(Kudos to the estimable Merrill Goozner for his cogent discussion of the issue)
- hospital admissions dropped precipitously last year – despite the major impact of COVID admissions. As I noted a while back, COVID patients aren’t very profitable; they rarely get surgeries or other procedures which generate big dollars for hospitals…
- meanwhile expenses are climbing – driven mostly by labor costs (up $86 billion this year)
- more than half of all hospitals are going to lose money…before COVID, the money-losing facilities amounted to only a third of the total.
Why this is happening…
- states that didn’t expand Medicaid are getting hammered as the other safety net payment programs mostly stopped helping hospitals make up revenue shortfalls.
- care has largely shifted to outpatient facilities which are way less costly – and generate way less revenue per admit – than inpatient stays
- it’s really hard to find staff – many are way past burnout, driven by overwork and abusive patients.
What does this mean for you?
Facility costs will go up.
Quality likely won’t.