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Hospital Revenue Sources Reach Dubious Milestone

Philip Betbeze, for HealthLeaders Media, January 4, 2013

Fortunately, hospitals and chief executives, by and large, have gotten this message. Several have told me in the past several months that "these are the good old days" and that reimbursements will never again be as relatively high as they are now.

With a few notable exceptions, they're working on the assumption that they need to get their expenses down by about 30% to survive on current Medicare rates. What they don't and can't know, entirely, is whether that will be enough.

How quickly those reimbursement rates will be ratcheted down, and by what means, leads to planning for a rainy day in the dark. It's just not possible to anticipate how far the cutting will go. As a result, many smaller hospitals are getting out of the game. The current high level of consolidation in hospitals is evidence enough for that. After all, there's no more draconian solution to long-term survival than giving up your independence.

In any case, don't look for quick or easy answers on how much will be enough. If recent history surrounding Congressional budget negotiations is any indication, there are none.


Philip Betbeze is senior leadership editor with HealthLeaders Media.
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1 comments on "Hospital Revenue Sources Reach Dubious Milestone"


Marion G. Kruse (1/12/2013 at 10:26 AM)
What's even more scary is how few individuals (relative to enrollees) are working and paying taxes to support the Obama Care agenda. That's the real fiscal cliff!! The book "Atlas Shrugged" by Ayn Rand should become mandatory reading for every U.S. citizen. The book "explores a dystopian United States where many of society's most productive citizens refuse to be exploited by increasing taxation and government regulations and go on strike. The refusal evokes the imagery of what would happen if the mythological Atlas refused to continue to hold up the world" (http://en.wikipedia.org/wiki/Atlas_Shrugged). Based on where the United States is heading, maybe the book should be reclassified as non-fiction!