The Massachusetts Hospital Association has issued a detailed financial report on hospitals in the state that addresses accusations by the state that hospitals are too expensive and must be more tightly regulated.
The association's report maps out the hospitals' financial predicament, citing inflation, growing patient safety demands, pressures for the latest medical technology, substantial government payor shortfalls, labor market forces and physician recruitment challenges.
The report also cites new steps that "should yield efficiencies and savings," such as development of medical homes, pay for performance, improvements in end-of-life care, medical claim standardization and reductions in preventable readmissions.
In fiscal year 2008, 78 percent of Massachusetts hospitals had an operating margin of less than 3 percent. After "an all-out effort to reverse trends through implementation of aggressive cost management," the hospitals improved their margins in FY 2009. But "the outlook for FY 2010 is bleaker than FY 2009," because "many hospitals relied on savings steps that cannot be replicated or sustained over time," according to the report.
State regulators have been pummeling hospitals over charges for many months. The state issued a 400-page report by researchers at the Boston University School of Public Health finding that Massachusetts hospitals spend a third more per person than the national average and have the highest per-capita spending in the world. At the time, the hospital association criticized the report's methodology.
When health insurers, citing higher hospital fees, issued double-digit rate increases, the state insurance commissioner denied nine out of 10 of the increases and the governor called for caps on hospital rate increases as well as on insurance premiums.
Read the Massachusetts Hospital Association's report.
The association's report maps out the hospitals' financial predicament, citing inflation, growing patient safety demands, pressures for the latest medical technology, substantial government payor shortfalls, labor market forces and physician recruitment challenges.
The report also cites new steps that "should yield efficiencies and savings," such as development of medical homes, pay for performance, improvements in end-of-life care, medical claim standardization and reductions in preventable readmissions.
In fiscal year 2008, 78 percent of Massachusetts hospitals had an operating margin of less than 3 percent. After "an all-out effort to reverse trends through implementation of aggressive cost management," the hospitals improved their margins in FY 2009. But "the outlook for FY 2010 is bleaker than FY 2009," because "many hospitals relied on savings steps that cannot be replicated or sustained over time," according to the report.
State regulators have been pummeling hospitals over charges for many months. The state issued a 400-page report by researchers at the Boston University School of Public Health finding that Massachusetts hospitals spend a third more per person than the national average and have the highest per-capita spending in the world. At the time, the hospital association criticized the report's methodology.
When health insurers, citing higher hospital fees, issued double-digit rate increases, the state insurance commissioner denied nine out of 10 of the increases and the governor called for caps on hospital rate increases as well as on insurance premiums.
Read the Massachusetts Hospital Association's report.