Hospital’s Not as Recession-Proof as Once Thought

The American Hospital Association (AHA), as released a comprehensive survey of hospitals throughout the country. Approximately 1,100 hospitals responded to a survey conducted in March of 2009. The report clearly indicates hospitals are making major cutbacks as a direct result of the economic downturn. Those surveyed reported:

• 90% have made significant cutbacks.
• 80% have cut administration costs.
• 50% have reduced staff.
• 20% have reduced subsidized services (behavioral health, post acute care, patient education, etc.).

These cutbacks are a direct result of a decrease in revenue, and other factors including:

• Increasing proportion of emergency department patients without insurance.
• Increase in patients on Medicaid and other public programs for low-income populations.
• Fewer patients opting for unnecessary (yet important) elective services.

The numbers are disheartening, but are to be expected in such an economic recession. From this data, an interesting question is raised: What effect will this have the quality of healthcare for patients? One argument is that the layoffs and staff reductions will not affect the quality patients receive, since those who are laid off are primarily in elective services.

However, as staff is reduced, the burden on the remaining staff and physicians becomes even greater. As a result, patients will likely find longer delays in treatment, backlogs of patients awaiting care will become longer, and further strain on already over-loaded care workers will mount. It is difficult to speculate as to the gravity of this effect, but undoubtedly these cuts will only further oppress the healthcare industry’s ability to provide adequate care.