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Flat Patient Volume Adds to Fiscal Concerns for 2012

Karen Minich-Pourshadi, for HealthLeaders Media, December 28, 2011
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This article appears in the December 2011 issue of HealthLeaders magazine.

CFOs continue to grapple with a snaillike economic recovery and now have the added challenge of a federal deficit crisis that promises to put Medicare and Medicaid reimbursement rates in further jeopardy. So, in an atmosphere with uncertainty in the national economic picture, shaky patient volumes, and reimbursement declines, finance leaders are understandably concerned about the coming year. Still, they do expect some positive developments in opportunities for capital projects and see potential for improved relations with commercial payers.   

Here, four of the 30 CFOs who participated in September’s inaugural HealthLeaders Media CFO Exchange in La Jolla, CA, offer their insights on the coming year.

Robert S. Shapiro
Senior Vice President and CFO
North Shore–Long Island Jewish Health System, Great Neck, NY
Total operating revenue 2011:
$6.1 billion (projected)
Total operating revenue 2010:
$5.6 billion
Total number of licensed beds:
5,300

What are the key areas you believe will affect your hospital in 2012?
Industry consolidation. The only positive from my perspective is that healthcare, like insurance and banking, is consolidating. That’s a positive because there are many costs in healthcare, administrative and otherwise, so at least with administrative costs you can get some economies of scale.

Reimbursements. I’m not expecting any increases from Medicare or Medicaid in the foreseeable future—I see it as a zero. I see managed care doing the same thing as the government—pushing back on rates and then these negotiations will become more challenging.

Patient volume. I’m worried about [patient] volume. It’s flat, and that trend only started in the past six months. We aren’t sure what the cause is for it flattening out; perhaps we’re just catching up with the other industries that got hit early in the economic downturn.

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