HealthLeaders Media Finance - March 24, 2008 | If It's Broke, Fix It View as a Webpage | Subscribe for Free
If It's Broke, Fix It
Philip Betbeze, Senior Editor-Finance

We all know healthcare wastes a lot of money--contributing to our sector's gobbling of ever-bigger pieces of the gross domestic product's pie each year. The problem of the rising cost of healthcare is blasted all over the Internet, newspapers and TV seemingly every day. Long-term, of course, it can't continue this way. Lots of smart people have been saying that for years. [Read More]

  March 24, 2008

 
Editor's Picks
Lobby backs hospital "tax"
What hospital leaders hate in Pennsylvania, they seem to love in Wisconsin. There are still skeptics, but a proposed hospital tax in Wisconsin has several hospital backers. Why? Because the tax isn't really a tax, its supporters say. A coalition of healthcare systems and business groups in Milwaukee say the state assessment, which would be a little more than 1 percent of each hospital's annual revenue, would attract more than $700 million in federal matching funds to the state, which would in turn allow the state to increase the amount of money it pays to healthcare providers for services provided to people in state health programs. I know proponents are just working the best they can within a system they didn't create, but somebody please explain to me how this type of bureaucratic nightmare makes economic sense in any way, shape or form. [Read More]
Group urges UConn to close old hospital
A proposal to close the crumbling John Dempsey Hospital on the University of Connecticut's Farmington campus could avoid the heavy squabbling among competitors since the University of Connecticut Health Sciences Center announced plans to build a $495 million expansion to the current hospital. The novel proposal from a study group says the hospital should team up with its bitter rivals to close the existing hospital and build an entirely new hospital on the same grounds. The group reasoned that a collaborative effort could help end a half-century of fighting over paying patients among four hospitals in the Hartford area. Though such a proposal might be difficult to execute, the end result might be less duplication of services and better value for patients, so I applaud the effort. [Read More]
Regulators beefing up fraud work on Medicare, Medicaid
As the private sector's role in covering government beneficiaries has advanced over the past few years with the proliferation of Medicare Advantage plans, among other private sector management of state and federal health beneficiaries, fraud has also proliferated. Now the government is belatedly stepping up efforts to root out this fraud. [Read More]
Washington hospital takes lessons from Toyota
Virginia Mason has been using Toyota's lean management techniques so long, they ought to at least get an assist. I first wrote a story about their use of Toyota's time-tested efficiency techniques back in 2005, and management at the Seattle-based hospital and clinic has only embraced the techniques more tightly. They've achieve huge cost and efficiency savings for the two entities, and who knows how many more patients they've attracted since they've streamlined the operations. If only they had a school that other healthcare leaders could learn from. [Read More]
Finance Forum
How to Ride Out the Financial Market Turbulence
It seemed like a reasonable strategy at the time--getting the lowest possible interest rates on debt issuance by using auction-rate financing and by obtaining insurance backing to reassure investors. In fact, since 1984, when auction rate debt first emerged in tax-exempt hospital financings, the strategy has worked well. In the course of two decades, only 13 auctions failed to place the debt offering. But in the second half of 2007, there were 31 failed auctions for auction-rate debt, and the situation has further deteriorated with many more failed auctions and soaring rates. What can hospitals do to get out of this mess? [Read More]
Finance Headlines
Massachusetts' safety net hospitals hurt by requirements
The Boston Globe - March 18, 2008
Walgreen buys its way into managing health
AP/Yahoo! News - March 18, 2008
Council clears hurdle for $450M Chicago hospital project
Chicago Tribune - March 19, 2008
Misys merging with Allscripts
Raleigh News & Observer - March 18, 2008
Healthcare firms continuing to grow in Pittsburgh area
Pittsburgh Post-Gazette - March 18, 2008
Atlanta's Grady Hospital may get $50M soon
Atlanta Journal-Constitution - March 18, 2008
Upcoming Events
HealthLeaders Media News - March 24, 2008
Sponsored Headlines from IBM

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From HealthLeaders Magazine
Your Hospital, the Entrepreneur
HealthLeaders March 2008 Forget those fixed-income investments. Many organizations are funding early-stage healthcare ventures that can yield not only healthy financial returns, but also improved efficiencies and better quality care. [Read More]
Money Talk

A look at one hospital's struggles to improve

University Hospitals Health System, Cleveland, OH

Rating: A2
Outlook: Stable
Affected Debt: $875 million
Agency: Moody's Investors Service
Remarks: Rating raised from A3 reflecting the system's ability to raise operating cash flow and implement strategies that will position the system better financially and strategically. [Read More]
Audio Feature

The Gains in Venture Capital: I spoke with Matthew Hermann this month for my cover story on hospital entrepreneurship. Some hospitals are investing in venture capital not only for the potential financial gains, but also to be able to take advantage of the innovative solutions being developed by the companies in which these funds invest. Ascension Health Ventures, which Hermann runs, is a so-called "captive" investment vehicle for Catholic health system giant Ascension Health that focuses on investments in early-stage healthcare companies, among other investments. Before joining AHV, he served for five years as vice president with a New York-based venture capital management company focused on early- to mid-stage healthcare services and information technology companies. [Listen Now]
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