Nine in 10 hospitals are making cutbacks to help weather the economic storm and nearly half have cut staff, reports a new survey of 1,078 hospitals conducted by the American Hospital Association in March. At the same time, more uninsured patients are coming through emergency departments, say six out of 10 hospitals. More than one in five hospitals reported reducing services such as behavioral health programs, post acute care, clinics and patient education. The majority of hospitals reported that fewer patients are seeking inpatient and elective services and that more Medicaid patients are being served. Over half the hospitals say that the need for hospital-subsidized services such as clinics, screenings and outreach is increasing as 40% report that charitable contributions are down.
Despite the measures hospitals are taking to cut costs, 65% report a decline in total margin and 57% say they’ve had a decline in operating margin in 2009 versus the same period in 2008. Forty-three percent expected a negative total margin in the first quarter of 2009. Fifty-nine percent reported a decrease in days cash on hand, and 31% reported a decrease in debt service coverage ratio in 2009 compared to the same period last year.
HFMA's information about the financial state of hospitals and actions they are taking to combat the financial downturn, along with how-to guidance, is available at www.hfma.org/pulse.
