HealthLeaders Media Finance - January 26, 2009 | They're From the Government, and They're Here to Help View as a Webpage | Subscribe for Free
They're From the Government,
And They're here to Help

Philip Betbeze, Senior Editor-Finance

That's the punchline from that old joke attributed to Ronald Reagan about the nine most terrifying words in the English language. I thought of that phrase after seeing details on how the $825 billion Obama stimulus bill would be divvied up, should it pass. To be sure, there's a lot of healthcare in the bill, but there's precious little healthcare reform. [Read More]

  January 26, 2009

Editor's Picks
Group says Boston hospitals not paying their fair share
Here's the shakedown on Boston's hospitals moving into a more advanced stage, predictably courtesy of unions that have so far been unsuccessful at organizing the hospitals. The fact is these hospitals legally owe nothing to the city, and the only way to force them to increase their "contribution" is through intimidation. I've long advocated for a workable and fair way to determine how much community benefit hospitals are providing in return for their federal and local tax exemptions. Because there's no good way, who knows whether these particular hospitals deserve to be exempt from taxes. The federal government is taking good first steps toward quantifying that nebulous calculation through the new Form 990, but Boston hospitals have put themselves in a bad spot in this spat by voluntarily contributing in the neighborhood of $4 million to the city this past year, suggesting they realize the community benefit they provide doesn't fully justify their tax exemption. So they shouldn't be surprised when times are bad that the city, with labor backing, comes back and asks for more. The precedent has been set. [Read More]
Healthcare among few bright spots in employment picture
While other sectors of the economy continue to shed jobs in this recession, healthcare is adding them. To wit: about 419,000 jobs in 2008. But these statistics are old. In the intervening months, I've seen story after story of health systems—whether they're strong financially or weak—that are laying off employees. Healthcare, according to the study, is expected to add jobs through 2016, but it will be interesting to see whether the sector continued to add jobs in 2009. Despite persistent shortages in some jobs, such as nurses, I'm betting it will be a close call. [Read More]
A front-row seat as the healthcare system goes awry
OK, this is not a healthcare finance story in particular, but it's a great Q&A between the Times reporter and Robert L. Martenson, MD, an ER and ICU physician who's written a book that critiques the waste in the American healthcare system. So in that respect, I guess it is finance-related. Of particular interest in the interview is Martenson's contention that the EMR is being touted as a panacea for healthcare spending that's out of control. Also particularly interesting is his take on dying in America, which includes a particularly interesting tidbit about Dr. Martenson's own father's death. The bottom line: The way we do it costs a lot more and is a lot less comfortable than it needs to be. [Read More]
Finance Forum
Conventional Community Benefit Measures Miss the Big Picture
Mike Allen, chief financial officer of Winona Health in Minnesota, had plenty to say about my take on the issue of community benefit as outlined in a column I wrote last November entitled, "Just Not Good Enough". How a nonprofit hospital's contribution to society from nonprofit hospitals should be valued is a sometimes-contentious argument in Congress. As a viewpoint from a hospital CFO who deals with these issues daily, Mike's interesting take illustrates where my Wal-Mart analogy falls short. [Read More]
Finance Headlines
Southwest Atlanta Hospital shuts down
Atlanta Journal-Constitution - January 19, 2009
Credit crisis claims small hospital in Bucks County, PA
Philadelphia Inquirer - January 19, 2009
Burbank, CA, hospital lays off 95 workers, closes four programs
Los Angeles Times - January 21, 2009
Columbia St. Mary's delays Milwaukee hospital completion
Milwaukee Journal-Sentinel - January 19, 2009
Baptist appeals Novant Health's Clemmons, NC, hospital
The Business Journal of the Greater Triad Area - January 20, 2009
Rhode Island hospitals: Cuts in budget could 'destroy us'
Providence Journal - January 20, 2009
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Flat-World Healthcare
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Service Line Management
A Spinal Shift
As minimally invasive procedures consume a larger portion of spinal care, provider organizations have many opportunities—and challenges—in an increasingly outpatient service line. [Read More]
Money Talk

A look at one hospital's struggles to improve

University Health System of Eastern Carolina, Greenville, NC
Rating: A1
Outlook: Negative
Affected Debt: $534 million
Agency: Moody's Investors Service
Remarks: Outlook revised from stable because of the decline in absolute and relative liquidity measures to 96 days cash on hand, which is 21 days from the 75 cash on hand covenants in two letters of credit.
[Read More]
Audio Feature

Reeling in the Revenue: Listen to my conversation with Jerry Miller, MD, president of Holston Medical Group in East Tennessee, about how his 70-physician multi-specialty practice convenes each year to strategize on investments the practice needs to make in strategic initiatives to diversify the practice's revenue streams. In an era in which physician practices are experiencing an influx of low-pay and no-pay patients in traditional services, Miller says it's more important than ever to the future of the practice to invest in strategic initiatives like e-visits and sleep centers.
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February 24: Form 990H: Act Now to Protect Your Reputation
February 12: Incentive-Based Compensation Plans to Enhance Physician Performance
On Demand: What Your Practice Is Worth: Calculating Fair Market Value
On Demand: Financial Meltdown: Managing Through the Crisis
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