There has never been a more difficult time to be a hospital executive in the United States. Regulations, billing systems, technology, politics, and customer demands are all evolving at dizzying and unpredictable paces. Hospital revenues are under increasing stress from labor unions, capital requirements, 3rd party payers, and competition from ambulatory service centers (ASC). Moreover, most of these forces are completely out of a hospital’s control.
Many hospitals have had a hard time adjusting to new demands and competition, and are now seeing their bottom lines erode and their service levels decrease:
- Average Total Hospital Margins in 2008 were 2.6% vs. 5.8% in 1998.
- 32.4% of hospitals reported negative margins in 2008 vs. 26.6% of hospitals in 1998.
- 43% of hospitals expect to report negative margins for YE2009.
- Chance of receiving care that meets generally accepted standards is only 55% in US.
