Hospital Budgets React to Perfect Storm Created by Global Markets
Fleming's thoughts should telegraph the significance of the global economy to all healthcare financial leaders because labor costs account for 40%-60% of most hospital budgets.
After all, hospitals and health systems must adhere tightly to their budgets if they are to succeed in the changing payment environment. And if supply prices for everything from gauze and gurneys are increasing, hospital finance executives may have to look at labor decreases to offset price constraints set off by activity in the global market. Fleming, however, offers a couple of other thoughts for financial leaders:
- Make some predictive projections for your budgets based on the global market.
- Stay informed about the global markets, so you can make smart purchasing decisions and created a fixed price with your vendors.
"There have been a [number] of factors affecting the global prices this year, but remember economies are also cyclical and what goes up must come down," says Fleming.
Karen Minich-Pourshadi is a Senior Editor with HealthLeaders Media.
- Patient Harm Data to Remain on Medicare's Hospital Compare Site
- Quiet ORs Better for Patient Safety
- Tavenner Confirmed as CMS Administrator
- Leapfrog Hospital Safety Scores 'Depressing'
- Building a Better Healthcare Board
- CMS Seeks to 'Rapidly Reduce' Medicare Spending with $1B in Grants
- Hard-Nosed About Physician Teamwork
- Rural Healthcare Can Entice the Best and Brightest
- Healthcare Leaders Sound Off on Organized Labor
- How Medical Debt Forgiveness Benefits Hospitals