Summary
Healthcare Inflation and the Labor Market: Insights from Matt Wolf
Matt Wolf, Health Care Senior Analyst and National Health Care Business Valuation Leader at RSM US LLP, shares his thoughts on the current state of inflation and the labor market in healthcare.
Increased Labor Costs and Inflation Pressure Providers
Wolf explains that labor costs have increased significantly faster than pre-pandemic levels. Supply chain and interest rates are also increasing, while reimbursements remain flat, putting pressure on providers. Despite exceeding expectations for November hiring across healthcare by 15%, more clinical and nonclinical labor is still needed to meet demand. Hospitals and health systems are also attempting to move more volumes into less acute settings to ease clinical burdens due to staffing challenges, but this can lead to margin compression and difficulty transitioning real estate to a new purpose.
Dependence on Contract Staffing Agencies
Hospitals are working to reduce their reliance on contract staffing agencies, but with high demand for care due to the active flu season and RSV, they may have no choice but to renew these contracts. Wolf highlights that the only way to reduce agency staffing would be to pay employed nurses more, but the reimbursement rates do not exist to support this.
Meeting the Increasing Demand for Healthcare Services
With the labor market and costs of healthcare services in flux, healthcare providers need to explore alternative ways to meet the increasing demand for medical services. This may involve investing in technology and telehealth solutions, as well as partnering with other healthcare providers to share resources and personnel.
Final Thoughts
Wolf stresses that the healthcare industry needs to adapt to the current labor market and inflation pressures to ensure ongoing access to quality medical care. This includes exploring alternative staffing models, improving reimbursement rates, and investing in innovative solutions to improve the efficiency and effectiveness of healthcare delivery.
Note: This is an AI generated transcript, not edited by a staff writer and is solely intended for educational purposes. If you have any questions/concerns, reach out to podcasts@beckershealthcare.com
This episode aired on 12/13/2022 and can be listened here.
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