To alleviate the vast numbers of young adults between the ages of 19 and 29 with no health insurance, New York Gov. David A. Paterson is preparing a plan that will allow many more young adults to be claimed as dependents on their parents' health insurance plans. The plan was praised by some healthcare experts as a major step forward, but early evidence from the roughly two dozen other states that have adopted similar programs suggests that their effectiveness in shrinking the ranks of the uninsured has been modest at best.
Columbia St. Mary's is slowing construction on its hospital in Milwaukee to conserve cash during the economic crisis. The new hospital, which had been set to open next January, is now scheduled to open in the fall of 2010. The $417 million hospital will consolidate Columbia St. Mary's two hospitals on Milwaukee's east side.
Florida and federal agencies are cracking down on corruption in the state's Medicaid program after revealing $124 million in improper payments and more than $56 million in fraud and abuse last fiscal year. The Center for Medicare & Medicaid Services said it had revoked the billing privileges of more than 1,100 medical equipment suppliers in South Florida and Southern California and suspended payments to home health agencies in Miami-Dade County. It also said it would require certain suppliers of medical equipment, prosthetics, orthotics, and supplies to post a $50,000 surety bond this year.
The national credit crisis has claimed a small Bucks County, PA, hospital devoted to breast-cancer care. Leif Murphy, chief executive officer of Diversified Specialty Institutes, said DSI was "seeking additional capital" to keep the hospital open, but there was only a "remote chance" it would succeed. In a letter to the state Department of Labor and Industry, DSI said it planned to close the Comprehensive Breast Care Institute at DSI of Bucks County, which has 89 employees, on Feb. 4.
Everyone knows that tired old saying, "when it rains, it pours." But how did that saying come into existence?
After all, it's not even true. As I'm sitting here next to my window, writing this column, it's clearly raining, but it's definitely not pouring. In fact, it's only a slight mist—some might even call it a heavy fog. Earlier today it rained harder than it's raining now, but even then it wasn't quite pouring. A steady, soaking rain, maybe. So who cares, right?
Well, bear with me, because I think you do. That saying isn't really about rain at all, is it? It's really about bad things that happen to you that are outside your control, and the tendency of such events to group together. Maybe you feel like you could deal with one problem at a time, but when they "pour" on you all at once, you've really got some bailing to do to keep your boat afloat. Sort of like dealing with the current financial crisis, denials, RAC audits, slow payers, no-payers, and other challenges that are affecting healthcare much more swiftly and deeply than they used to.
Now we're getting somewhere.
I've talked to a lot of smart folks over the past few months about what this crisis is doing to healthcare in general and hospitals in particular, and none has used the phrase about rain. But I keep thinking about it as I hear them recite the litany of troubles affecting their professional lives. Like a bad song, it keeps turning over in my head.
Whether you're a CEO, CFO, or anyone else in a hospital leadership position, cash on hand is king with a capital K. One person in the know told me the other day that a hospital CFO she talked to told her his cash on hand dwindled by half in the last days of 2008 as he dealt with a tremendous slowdown in pay speed from commercial insurers and a big increase in denials. It's a vicious cycle. Then hospitals have to lay off staff and slow-pay vendors themselves. It's easy to see how a recession builds on itself. You're dealing with declines in patient volumes due to softening on elective procedures. Your payer mix might be changing. In some areas where the weaker players are shutting down, your Medicaid volumes are likely increasing. You're dealing with contraction of the market in hospital spending. In any case, the status quo is no longer effective and you're making drastic, gut-wrenching decisions.
At the same time, you still have to spend on information systems, productivity measures, and other ways to hold your cash longer and get what you're owed in the door. So in financial terms, the weather's bad and getting worse. I, for one, don't envy your job in this financial climate.
Just keep your wits about you and do your best to stay on top of what this mess is doing to your hospital so that when it's raining, and pouring, you won't be the old man who's snoring.
Philip Betbeze is finance editor with HealthLeaders magazine. He can be reached at pbetbeze@healthleadersmedia.com.Note: You can sign up to receiveHealthLeaders Media Finance, a free weekly e-newsletter that reports on the top finance issues facing healthcare leaders.
University of Alabama Hospital wants UAB Highlands to operate with it as one institution, although they will keep their separate campuses, UAB Health System CEO Will Ferniany announced. Ferniany said the health system has to continue to improve in order to stave off economic challenges. He said he aims for the hospital to have a 3% operating margin by the end of 2010, which will allow it to have the resources it needs. Ferniany said he didn't know the exact margin right now, but figured it is lower than 3%.