The industry rebounded in May after a drop in the previous month as employment climbed overall.
Healthcare paced all industries in job growth for May, contributing to a robust increase across all sectors for the month, according to the latest data from the Bureau of Labor Statistics.
While many healthcare organizations are battling workforce shortages, the steady addition of jobs illustrates a relatively healthy market.
Here are five numbers that show where healthcare jobs were trending in May:
Healthcare created 68,300 jobs, which was a 22% increase from the 56,000 jobs added in April. It was a bounce back after April’s figure represented a 22% drop from March.
Healthcare accounted for 25% of the 272,000 jobs created in total, leading other top-performing industries like government (43,000), leisure and hospitality (42,000), and professional, scientific, and technical services (32,000). The overall figure was higher than the average monthly gain of 232,000 jobs over the previous 12 months.
Employment growth continued in ambulatory healthcare services (43,000), hospitals (15,000), and nursing and residential care facilities (11,000).
Jobs also increased in physician offices (13,400) and home healthcare services (19,600).
The average monthly gain in employment for healthcare has been 64,000 over the past 12 months.
As healthcare creates more jobs, younger generations will continue to enter the workforce. That’s why many hospital CEOs are strategizing to improve training, recruitment, and retention efforts among younger works to ensure a sustainable workforce of the future.
The agency has been denied not once, but twice as it aims to nix Novant Health’s acquisition.
A district court has declawed the Federal Trade Commission (FTC) in the antitrust agency’s attempt to halt another hospital acquisition.
After denying the FTC’s preliminary injunction to block Novant Health’s $320 million purchase of two hospitals from Community Health Systems (CHS) last week, U.S. district judge Kenneth Bell again denied another motion to stop the deal on Tuesday.
The agency had filed a lawsuit against the transaction in January before seeking a preliminary injunction in March, deeming the deal “unlawful” because it would create overwhelming market consolidation to the tune of 64% in the Eastern Lake Norman Area.
However, Bell said in his initial ruling that the market is already concentrated without the acquisition due to Atrium Health owning nine of the region’s 19 hospitals, while Novant owns seven. Allowing Novant to strengthen its position would enable it to better compete with Atrium, while also increasing the likelihood of the two purchased hospitals remaining open under new ownership.
“Therefore, the proposed merger carries at least as much likelihood of competitive benefits as it does competitive harm and the FTC is unlikely to ultimately be successful in proving that the transaction may ‘substantially lessen competition,’” Bell wrote.
Novant president and CEO Carl Armato said the health system was “thrilled” with the court’s ruling.
“This outcome is a victory for the area, and our plan to deliver on the commitments we’ve made begins now,” Armato said in a statement. “We have always believed these communities deserve access to a rich healthcare ecosystem with robust and comprehensive care services from family physicians to pediatrics and specialty care.”
The judge followed up the decision by once again denying the FTC’s latest preliminary injunction while the case is being appealed.
Bell reiterated that stopping the deal would lead to Davis Regional Medical Center closing “immediately,” resulting “in the loss of critically needed inpatient psychiatric services, visiting real harm, not theoretical competitive harm, on numerous patients and their families.”
Bell did, however, extend a temporary restraining order on the acquisition until June 21 to allow the FTC enough time to seek an injunction from the Fourth Circuit Court of Appeals. The transaction between Novant and CHS was authorized to close on June 12.
While Bell’s rulings may not be indicative of how future FTC enforcement actions play out, it is nonetheless noteworthy during a time when the agency has increased its oversight.
As more mergers take place between hospitals seeking consolidation to weather financial storms, the extent to which the FTC is successful in thwarting deals could significantly affect the long-term plans of health systems.
The Pennsylvania-based hospital operators will combine one year after announcing the move.
The University of Pittsburgh Medical Center (UPMC) has cleared regulatory hurdles to close its acquisition of two-hospital nonprofit Washington Health System.
One year after the operators announced plans to merge, the completion of the deal now allows UPMC to invest at least $300 million over 10 years to improve clinical services and upgrade facilities at the two hospitals, renamed to UPMC Washington and UPMC Greene.
“UPMC has a long, successful track record of affiliations with like-minded organizations,” Leslie C. Davis, president and CEO of UPMC, said in a statement. “We know how essential these hospitals are to this region to preserve needed health care services and livelihoods of thousands touched by them, and we are thrilled to welcome UPMC Washington and UPMC Greene to UPMC.”
Despite scrutiny of the move in an op-ed last fall by SEIU Healthcare Pennsylvania, the transaction passed as the union advocated for the Assurance of Voluntary Compliance that UPMC agreed to with the attorney general as a condition for the takeover of Washington Health.
While the agreement contains protections for employees and the community, union leaders said it should have done more to ensure facilities stay open and jobs aren’t cut.
“We are united to hold UPMC accountable to abide by the agreement as well as honor the promises that have been made to our community to invest $300 million and maintain all services, insurance plan access, jobs and union contract standards,” SEIU said in a statement.
“The healthcare workforce is already struggling with a severe staffing crisis, the lingering effects of the pandemic, turnover, burnout and inflation. Any cuts – such as the service terminations, closures, layoffs and pay reductions that UPMC has carried out across its system – would be devastating to Washington. UPMC must instead, as promised, invest significant resources in our workforce and the care we deliver.”
The completion of the deal comes on the heels of UPMC announcing layoffs of around 1,000 employees, mostly of non-clinical and administrative staff.
After experiencing a jump in labor costs by 6.4% to $9.7 billion in 2023, contributing to a $198 million operating loss, the health system has turned to reducing expenses.
The longtime leader of Banner Health shares how the role is different now from when he first started.
Since taking the helm at Banner Health 24 years ago, up until his retirement at the end this month, veteran CEO Peter Fine has seen how leading a hospital has changed over time.
As patients' wants and needs have shifted, the CEO has had to follow suit. At a certain point, around 2017, hospitals realized they weren't just dealing with patients, but "customers" because "the public was judging us not on our clinical product, but the ease of usage," Fine told HealthLeaders.
"The focus before was all we have to do is provide a good clinical product and that satisfies everybody. Well, that's not the case," Fine said. "So that causes you to have to change certain things in your style and your approach and the things that you say and do in front of others become way different. Creating that recognition for everybody that you also have to look for opportunities to take away pain points that get in the way of the consumer interacting with us. It's a different approach because how you speak and what you say become way different."
Fine will retire on June 30 after two-plus decades as CEO of the Phoenix, Arizona-based nonprofit health system, giving way to president Amy Perry, who aims to build on his foundation with a technology-forward approach.
Pictured: Banner Health CEO Peter Fine.
As many hospital CEOs are calling it a career, it's contributing to a steady churn at the position that has been exacerbated in recent years due to mounting challenges. According to Fine, the pressure has never been higher and between private equity, relationships with payers, and the growth of Medicare Advantage plans, it's no surprise that leaders are willingly stepping aside.
"COVID took its toll on many, many leaders," Fine said. "Partly because of what we went through for a two-plus year period, but also the change in how you have to lead. I was always used to walking out of my office, walking to one of 10 other offices on the floor there at 4:00 in the afternoon and just sitting down and talking about strategy and the organization. Now everything is a scheduled Zoom call or a Teams call and there's no spontaneity. So for many, they had to learn a new way of leading an organization, figuring out how to be visible and figuring out how to stylistically be out in front of the organization as much as they can."
For Fine, how the CEO role evolved during his tenure was part of the reason why he found the job so intellectually stimulating, causing him to keep tacking on years to the "highly unusual" 47 overall he spent in healthcare.
"It changed and morphed as an organization into a different kind of business today than it was back in 2000," he said. "It was fun and interesting and when something's fun and interesting and intellectually stimulating, in my case, having tremendous governance along the way and board leadership that's very professional, that was advantageous as well. Not everybody has that.
"The idea of watching an organization grow and finding opportunities for an organization to grow made it, quite frankly, a fun job."
For young clinicians, the emotional toll of discrimination in work settings can be significant.
Without addressing the generational differences between healthcare workers, hospital CEOs will have a harder time maintaining a sustainable workforce.
When it comes to younger workers, leaders must recognize that creating a more equitable, inclusive environment can go a long way in attracting and retaining staff.
Specifically, tackling racism and discrimination in the workplace can help mitigate stress and burnout for workers ages 18 to 29, according to a blog post by the Commonwealth Fund analyzing a recent survey.
Conducted by the African American Research Collective, in partnership with the Commonwealth Fund, the survey fielded responses from 3,000 younger clinicians—doctors, nurses, dentists, medical assistants, and others—in early 2023.
Findings revealed that younger workers agree that racism or discrimination based on race or ethnicity against patients is a major problem (67%) more frequently than workers overall (52%).
Younger clinicians also reported witnessing patients face racism or discrimination based on their race or ethnicity (64%) more often that all workers (47%).
These experiences are weighing more heavily on younger workers, with 30% of respondents reporting feeling "a lot of stress" from dealing with racism or discrimination, compared to 16% for workers overall.
Due to workforce shortages, clinicians are already under a lot of duress to meet the demands of the profession. When CEOs consider how to alleviate the burden that is being placed on their staff, they must also consider how they can solve for the emotional challenges workers are contending with, in addition to the mental and physical ones.
That was a point of emphasis at the recent HealthLeaders CEO Exchange, where dozens of hospital leaders from across the country came together to share ideas and best practices. Attendees discussed how to improve the experience for their workforce by focusing more on aspects such as relationships and culture to ensure they're doing everything they can to keep their staff happy.
To address racism and discrimination, the Commonwealth Fund suggests that leaders create an environment in which workers feel comfortable reporting those instances. Nearly half of younger workers surveyed (48%) said that they worry about retaliation or negative consequences if they were to report racism or discrimination in the workplace. Having reporting protocols in place for these situations would not only put workers more at ease, but it would also encourage reporting on these issues and show a commitment to stamping them out.
Additionally, the Commonwealth Fund posits that decision-makers institute more equity-centered hiring and retention practices to create more diversity and inclusion in the workplace. Making workers feel like they belong and are valued in their organization can greatly aid in the fight against employee turnover.
Are you a CEO or executive leader interested in attending an upcoming event? To inquire about attending the HealthLeaders Exchange event, email us at exchange@healthleadersmedia.com.
The HealthLeaders Exchange is an executive community for sharing ideas, solutions, and insights. Please join the community at our LinkedIn page.
Multiple states already have benchmarks in place, while others have approved limits on price increases.
State caps on how much health systems can charge patients and payers are putting many operators at a disadvantage, according to new data.
The benchmarks instituted by several states could negatively impact revenue and operating margins by nonprofit hospitals during a time when operators are combating rising expenses, a Fitch Ratings report revealed.
Connecticut, Maryland, Massachusetts, Nevada, New Jersey, Oregon, Rhode Island, and Washington have caps on cost increases, which Fitch stated have limited rates and levels of reimbursement. More states are following suit, with Delaware having approved a bill that would cap price increases at 2% over the next two years, while California approved a price growth target of 3% to be phased in over the next five years.
For nonprofit hospitals, expenses have increased year-over-year in the high single digit range over the last several years, with median expense growth overtaking median revenue growth in 2021-22 and 2022-23, Fitch said.
Labor costs can constitute as much as 60% of those expenses and with the job openings rate of 9.6% more than doubling the average from 2010 to 2019, the labor market will continue to put pressure on hospitals.
While all hospitals are dealing with these challenges, nonprofit operators are more constricted in their ability to cut services due to their missions.
One nonprofit health system that's based in a state with cost caps is turning around its finances though.
Thanks to a rising in inpatient volume and reduced length of stay, Renton, Washington-based Providence reported $360.3 million in net income for the first quarter following two years of major losses.
The system also dealt with labor costs, salaries and benefits expenses increasing 4%, but cutting agency contract labor by 42% allowed it to keep expenses manageable.
Patients in the area will have greater access to quality care, the hospitals state.
Two of Oregon’s biggest hospital operators have agreed to combine in what would be one of the largest mergers in the state’s history.
Oregon Health & Science University (OHSU) and Legacy Health signed a definitive agreement to create a 12-hospital system consisting of around 30,000 employees with the aim of reaching more patients and delivering better care.
If approved by regulators, the resulting system, known as OHSU Health, would also be one of the largest providers of services to Medicaid members in Oregon.
“Right now, increased demand and capacity restraints are keeping patients around the region from accessing the services OHSU Health is uniquely capable of providing,” OHSU president Danny Jacobs said in the news release. “As a single, integrated system, we can better ensure patients receive the right level of care at the right facility without having to travel outside the region, whether its complex cancer care on Marquam Hill or behavioral health treatment in Northeast Portland.”
OHSU announced it will commit around $1 billion over 10 years, financed mostly through bond offerings, to invest in care infrastructure. After the deal closes, a Legacy community foundation will receive funds equal to Legacy Health’s cash less its debt and a negotiated withhold, for supporting healthcare and health equity in the communities.
The operators said the new system will be able to better attract, retain, and train healthcare professionals.
The Oregon Nurses Association (ONA), which represents more than 4,500 nurses and providers from OHSU and more than 1,300 nurses and providers from Legacy, released a statement calling for the hospitals to protect their workers and place the focus on improving patient care.
“This agreement must increase health care services, quality and access for patients, and equip and support providers to better care for all our community members,” the ONA said. “That includes ensuring OHSU’s merger money does not come out of patients’ or workers’ pockets. OHSU needs to work on improving services and investing in our community without sacrificing current standards.”
A new survey highlights the importance of being prepared to deal with a cyberattack and data breach.
With cyberattacks in healthcare on the rise, it’s vital that practices have security measures in place to protect patient data.
Yet, only 63% of organizations have a cybersecurity plan in place, according to a survey by Software Advice, which means many are vulnerable to potentially crippling attacks that can be costly and damaging to patient trust.
The survey fielded answers from 296 respondents with IT management, data security, data management, security training or audit responsibilities at healthcare organizations around the country.
The data revealed that half of organizations have experienced a data breach, with 32% dealing with one in the past three years.
More than one in four practices (42%) has experienced a ransomware attack, with nearly half (48%) reporting the attack impacted customer data, while 27% said it impacted patient care.
After a ransomware attack has taken place, a third of respondents (34%) failed to recover patient data from their attackers.
With 55% of practices allowing access to more data than employees need to their job, it introduces greater human error into the mix.
To counter the increase in threats, CEOs at both provider and payer organizations must take a proactive approach to cybersecurity.
That includes putting preventative measures in place, such as more training for employees handling data to help them identify scams and attacks, as well as limiting certain data to the employees that need it.
Preventative measures, however, aren’t effective for attacks that have already happened, which is why it’s crucial for CEOs to implement a response plan “that includes defined roles and responsibilities, communication protocols, and a prioritization list,” the report said.
Not every organization that is prepared to prevent and respond to a cyberattack will be safe though.
Banner Health’s next CEO, Amy Perry, recently told HealthLeaders that it’s difficult to protect yourself again bad actors that are coming at you from all different angles.
"Do I see a solution? Not an easy solution,” Perry said. “All of the health systems, including Banner, have multiple, multiple investments in protection. But again, moving at the speed that the people that are working on the other side of this in the dark corners of the world, I think we've got a long way to go before we figure out how we keep ourselves safer every day.”
Hospital leaders are weighing how to get the most out of their people and operations across their organizations.
As healthcare reckons with change, hospital and health system CEOs recognize that the status quo is no longer cutting it.
To combat the challenges at the forefront, as well as the ones brewing under the surface, leaders must have a proactive mindset for the sake of the people in their organization and the business.
Here’s a look at four areas executives at the recent HealthLeaders CEO Exchange in Kohler, Wisconsin, identified as in need of a fresh approach:
Leadership accountability
CEOs may oversee everything, but they can’t be everywhere all at once. That’s why it’s critical to develop accountability within the C-suite and management teams to ensure goals are being met.
How can you foster accountability? For one, CEOs at the Exchange shared that it’s important that an expectation is set, while aligning leaders with system goals and showing them where they fit. It’s likely that leaders will have blind spots, but it’s on CEOs to point those out and address them.
Most importantly though, accountability can’t be achieved without metrics to track performance. CEOs should give their leaders the proper resources, analytics, and data so they can see how their decisions play out.
Physician autonomy
Attracting and keeping physicians is one of the biggest pain points CEOs are grappling with right now.
There are several ways to improve physician relations, but one strategy CEOs shouldn’t overlook is giving their doctors more of a say in how they practice.
Physicians care about their life mission and as such, they want to be involved in the clinical decisions made at the highest level. They also want to be part of administrative decisions, but they especially want to drive clinical care. It’s on CEOs to give them the forum to do just that.
Whether it’s through surveys or open dialogue, CEOs can seek out from their physicians the areas that would move the needle most, potentially leading to higher satisfaction and greater attachment to the organization.
Pictured: Attendees take part in discussions at the CEO Exchange.
Implementing AI
Some technology investments in healthcare still feel like a risk at this point, but it’s hard to deny the immediate benefits of implementing generative AI.
Another way of keeping physicians happy is by cutting down on the administrative work that often leads to burnout and that’s one instance where AI can work its magic. For example, physicians can get more time back with AI reducing the constant need for inbox management, allowing doctors to do more fulfilling work with their patients or focus on their own well-being.
Margins are tight for many, but many hospitals will be stuck in an endless cycle unless they set aside resources to invest in innovative solutions that will soon be essential and not just a luxury.
Building a pipeline
While CEOs have their hands full maintaining their workforce, they must look beyond the current generation of workers if they want to build something sustainable.
That means working with educational institutions, all the way down to the high school level even, to develop skills that will be crucial to the future of healthcare. Dual curriculums or national certifications, for example, will create more workforce opportunities and streamline clinical talent to organizations that need them.
There also needs to be a greater emphasis on developing a tech skillset for the next wave of workers. As more technology enters the industry, both clinical and non-clinical staff with experience handling systems will be valuable for hospitals.
Are you a CEO or executive leader interested in attending an upcoming event? To inquire about attending the HealthLeaders Exchange event, email us at exchange@healthleadersmedia.com.
The HealthLeaders Exchange is an executive community for sharing ideas, solutions, and insights. Please join the community at our LinkedIn page.
The company reportedly wants a partnership to back the opening of new clinics.
CVS Health appears committed to growing its Oak Street Health business, but reportedly wants help with its expansion efforts.
The retail giant is on the lookout for a private equity partner to bring in funding for the primary care provider it purchased a year ago for $10.6 billion, according to Bloomberg News.
A potential joint venture would lessen the financial burden on CVS as it aims to open new clinics without being encumbered by heavy losses.
The report stated that the company is working with financial advisers and has reached out to multiple private equity firms about a partnership. However, the discussions are in the preliminary stage so it’s possible a deal may not happen.
Bloomberg cited that CVS is eyeing a similar joint venture to the one Humana forged with Welsh, Carson, Anderson & Stowe (WCAS) in 2020 and 2022 for CenterWell Senior Primary Care, which allowed Humana to buy back its interest over time while netting WCAS a return.
CVS said in February that it wants to have more than 300 Oak Street clinics by 2026, including the opening of 50 to 60 clinics this year.
While the company pushes forward with expansion, other retailers such as Walmart and Walgreens have retreated from their primary care business due to difficulties in scaling.
The primary care business is a slow burn because it is cost-intensive, but allows organizations to guide patients to more lucrative care and services.
By bringing in a private equity firm to share the investment required to prop up Oak Street, CVS would have more leeway to see through its long-term vision for the clinics.
