MONROE - Fewer patients are seeking hospital care, while at the same time a growing proportion of patients need help paying for service, according to a report released last month by the American Hospital Association (AHA).
The same appears to be happening in Wisconsin, according to the Wisconsin Hospital Association (WHA). The WHA is collecting state-specific data to help quantify the troubled economy's impact on Wisconsin hospitals. Responses to an online survey from hospital CEOs and CFOs were due Dec. 5.
The AHA report finds many hospitals are beginning to see the effects of the economic downturn, with more than 30 percent reporting a moderate to significant decline in patients seeking elective procedures, and nearly 40 percent reporting a drop in admissions.
Like many other organizations, Monroe Clinic has felt the economy's impact. It has seen a 5 percent decrease in the number of inpatients, or patients admitted to the hospital, in 2008.
Outpatient visits, such as day surgeries, and clinic visits actually are higher than last year by 2 percent and 3 percent, respectively.
However, while outpatient visits are up, they are below projected growth targets, according to a response prepared by Monroe Clinic for this article.
Worried about keeping their jobs, some people may not want to take a leave of absence for a medical procedure, or even take time off work to visit the doctor. Others may put off elective or preventive visits due to financial concerns.
People who have lost jobs also may be losing their health insurance. Every 1 percent increase in unemployment leads to a loss of employer-sponsored coverage for an estimated 2.5 million employees and dependents, according to the AHA report.
The majority of hospitals surveyed by AHA noted an increase in the proportion of patients unable to pay for care.
More than 50 percent of hospitals reported a moderate to significant increase in uncompensated care, and 37 percent report a need for subsidized services in the past three months relative to projected levels.
Uncompensated care was up 8 percent from July to September versus the same period last year, according to the AHA report.
Monroe Clinic reports seeing applications for its Community Charity Care program increase as the number of uninsured rises.
Monroe Clinic delivered $13.5 million in community benefit in 2007 and projects $15.9 million for 2008 and $17.5 million for 2009.
"As a Catholic health ministry, we'll continue to care for the community's most vulnerable patients regardless of their ability to pay," President and CEO Mike Sanders said.
According to the WHA Web site Price Point, Monroe Clinic's uncompensated care was $7.5 million, or 3.1 percent in 2007; charity care made up 1.2 percent, or about $2.9 million. Charity care does not include the discounts hospitals negotiate with insurers, nor does it include the charges not paid by government programs like Medicare and Medicaid.
State and federal budget difficulties raise worries about potential cuts to Medicare and Medicaid, which cover about half of the patient care provided by the nation's hospitals.
According to Price Point, Monroe Clinic's revenues from Medicare and Medicaid total $130 million, while private insurance totals $100 million.
But the site also shows that private insurance pays only about 75 percent of Monroe Clinic charges, while Medicare covers about 35 percent of charges, and Medicaid and other government programs pay only about 13 percent of total charges.
In Wisconsin, Medicare and Medicaid pay on average only about one-third of the charges they incur.
Hospitals that have a relatively high percentage of government-program patients are forced to recover a greater percentage of their operational costs from privately insured and self-pay patients through higher charges.
Medicaid expenditures are the largest and fastest growing portion of many state budgets, and increase even faster during economic downturns as enrollment grows and state tax revenues drop.
Medicare and Medicaid payments have fallen short relative to hospital costs since 1999, and have reached about $30 billion in shortfalls in 2007. Shortfalls have been steadily increasing by about $5 billion annually for the past four years.
Overall, health care was responsible for 45 percent of all new private sector jobs in 2007.
The AHA report noted that hospitals, which employ 5 million people, could be facing uncertain times as their financial health falters and the ability to borrow funds for improving facilities and updating technology is squeezed.
Financial stress is forcing hospitals to make or consider making cutbacks to weather the economic storm, including cutting administrative costs (59 percent), reducing staff (53 percent) and reducing services (27), among the hospitals surveyed.
Monroe Clinic has not had to make changes to the number of employees due to the economy, but rather has been able to adjust to decreased patient volumes by reducing contract and "availability" staff hours, (i.e., those who work on an as-needed basis).
Hospitals have seen the immediate impact of the economic downturn in other ways. According to the AHA report, total margins fell to negative 1.6 percent in the 3rd quarter of 2008, versus a positive 6.1 percent during the same period last year.
Like many institutions, hospitals rely on investment income as one of the ways to help make ends meet, especially since government payers do not cover the costs of care. However, recent turmoil in the stock market has turned investment gains to losses, further worsening hospitals' financial condition.
While its investment portfolio (long-term funds saved to fund future capital projects) has lost value with the market, overall Monroe Clinic invests those funds relatively conservatively, according to Vice President-Chief Financial Officer Julie Wilke.
"Our financial position remains solid, as evidenced by a recent affirmation of our A rating with an outlook of stable by Fitch Investment Services," Wilke said.
"We'll continue to operate as efficiently as possible, and hope the economy begins to improve over the next year or so," said Sanders. "Like everyone else, we'll be tightening our belts while we ride this out."
The same appears to be happening in Wisconsin, according to the Wisconsin Hospital Association (WHA). The WHA is collecting state-specific data to help quantify the troubled economy's impact on Wisconsin hospitals. Responses to an online survey from hospital CEOs and CFOs were due Dec. 5.
The AHA report finds many hospitals are beginning to see the effects of the economic downturn, with more than 30 percent reporting a moderate to significant decline in patients seeking elective procedures, and nearly 40 percent reporting a drop in admissions.
Like many other organizations, Monroe Clinic has felt the economy's impact. It has seen a 5 percent decrease in the number of inpatients, or patients admitted to the hospital, in 2008.
Outpatient visits, such as day surgeries, and clinic visits actually are higher than last year by 2 percent and 3 percent, respectively.
However, while outpatient visits are up, they are below projected growth targets, according to a response prepared by Monroe Clinic for this article.
Worried about keeping their jobs, some people may not want to take a leave of absence for a medical procedure, or even take time off work to visit the doctor. Others may put off elective or preventive visits due to financial concerns.
People who have lost jobs also may be losing their health insurance. Every 1 percent increase in unemployment leads to a loss of employer-sponsored coverage for an estimated 2.5 million employees and dependents, according to the AHA report.
The majority of hospitals surveyed by AHA noted an increase in the proportion of patients unable to pay for care.
More than 50 percent of hospitals reported a moderate to significant increase in uncompensated care, and 37 percent report a need for subsidized services in the past three months relative to projected levels.
Uncompensated care was up 8 percent from July to September versus the same period last year, according to the AHA report.
Monroe Clinic reports seeing applications for its Community Charity Care program increase as the number of uninsured rises.
Monroe Clinic delivered $13.5 million in community benefit in 2007 and projects $15.9 million for 2008 and $17.5 million for 2009.
"As a Catholic health ministry, we'll continue to care for the community's most vulnerable patients regardless of their ability to pay," President and CEO Mike Sanders said.
According to the WHA Web site Price Point, Monroe Clinic's uncompensated care was $7.5 million, or 3.1 percent in 2007; charity care made up 1.2 percent, or about $2.9 million. Charity care does not include the discounts hospitals negotiate with insurers, nor does it include the charges not paid by government programs like Medicare and Medicaid.
State and federal budget difficulties raise worries about potential cuts to Medicare and Medicaid, which cover about half of the patient care provided by the nation's hospitals.
According to Price Point, Monroe Clinic's revenues from Medicare and Medicaid total $130 million, while private insurance totals $100 million.
But the site also shows that private insurance pays only about 75 percent of Monroe Clinic charges, while Medicare covers about 35 percent of charges, and Medicaid and other government programs pay only about 13 percent of total charges.
In Wisconsin, Medicare and Medicaid pay on average only about one-third of the charges they incur.
Hospitals that have a relatively high percentage of government-program patients are forced to recover a greater percentage of their operational costs from privately insured and self-pay patients through higher charges.
Medicaid expenditures are the largest and fastest growing portion of many state budgets, and increase even faster during economic downturns as enrollment grows and state tax revenues drop.
Medicare and Medicaid payments have fallen short relative to hospital costs since 1999, and have reached about $30 billion in shortfalls in 2007. Shortfalls have been steadily increasing by about $5 billion annually for the past four years.
Overall, health care was responsible for 45 percent of all new private sector jobs in 2007.
The AHA report noted that hospitals, which employ 5 million people, could be facing uncertain times as their financial health falters and the ability to borrow funds for improving facilities and updating technology is squeezed.
Financial stress is forcing hospitals to make or consider making cutbacks to weather the economic storm, including cutting administrative costs (59 percent), reducing staff (53 percent) and reducing services (27), among the hospitals surveyed.
Monroe Clinic has not had to make changes to the number of employees due to the economy, but rather has been able to adjust to decreased patient volumes by reducing contract and "availability" staff hours, (i.e., those who work on an as-needed basis).
Hospitals have seen the immediate impact of the economic downturn in other ways. According to the AHA report, total margins fell to negative 1.6 percent in the 3rd quarter of 2008, versus a positive 6.1 percent during the same period last year.
Like many institutions, hospitals rely on investment income as one of the ways to help make ends meet, especially since government payers do not cover the costs of care. However, recent turmoil in the stock market has turned investment gains to losses, further worsening hospitals' financial condition.
While its investment portfolio (long-term funds saved to fund future capital projects) has lost value with the market, overall Monroe Clinic invests those funds relatively conservatively, according to Vice President-Chief Financial Officer Julie Wilke.
"Our financial position remains solid, as evidenced by a recent affirmation of our A rating with an outlook of stable by Fitch Investment Services," Wilke said.
"We'll continue to operate as efficiently as possible, and hope the economy begins to improve over the next year or so," said Sanders. "Like everyone else, we'll be tightening our belts while we ride this out."