By Ed Yoder, MBA, MHA, RT(R), CRA, FAHRA
December 2013—These days, we all have our eyes on the changes in national healthcare. We worry about where it’s going, what it will mean, and where it will lead us. The government continues to tell us healthcare costs are spiraling out of control, but hospitals around the country are controlling costs – at least we think so! A recent update from the American Hospital Association (AHA) made it apparent that expense control and reductions, overtime reductions, restriction of PRN use, and examining the need for each and every FTE have been happening across the country.
Locally, we are seeing healthcare insurance costs rising. Local business employers have reported premium insurance increases of 20% to my organization! Continued blame for these premium increases is placed on hospitals and physicians, but general inflation in healthcare is nowhere near the 20% insurance premiums employer insurance plans are passing along to their employees. It doesn’t hurt to have some facts when insurance companies are quick to blame hospitals and physicians for premium increases. The facts I am about to share do not support their case that hospitals and physicians are to blame.
In October 2013 the healthcare industry added 15,000 jobs. This figure was down from the 24 month average of 21,000 jobs; however, it is up from the loss of 2500 jobs in September 2013. These figures are according to the latest economic indicators from the Altarium Institute’s Center for Sustainable Health Spending. Healthcare added only 6800 jobs in September, one-third below the 24 month rate. National healthcare prices were only 1% higher than August 2012 prices, down one-tenth from July 2013 and equal to May 2013, the all-time low in the data, which extends back to January 1990. The 12 month moving average, at 1.5%, is also a new low for our data.
Hospital price growth fell to 1.5%, its lowest rate since 1.3% in December 1998, while physician prices grew a scant 0.3%. Hospital price growth plays a dominant role in the total index via its spending weight, and its low August reading was complemented by a decline in home health prices (-0.2%) and durable medical equipment (-0.1%), plus moderate growth otherwise. Home health and durable medical equipment also declined. What does this mean? Well, healthcare costs have not risen significantly, so you cannot blame the increase of the insurance premiums on our business, on the hospitals and physicians, because we are not contributing to the increase. The next time you hear someone bashing hospitals or physicians for high healthcare costs, use those statistics I just armed you with to fight that argument. Insurance costs are on the rise due to the insurance organizations themselves. For years we have been trying to keep pace with rising premiums, and it appears to me we are doing our part, so why the continued rise in premiums?
With all of this pressure to control costs and cut back, I know some of your travel and educational budgets have been decreased or eliminated – it’s a trend we’ve been seeing across AHRA for a few years now. To help with costs, AHRA is offering an early bird discount for the 2014 Annual Meeting – register before December 31 and you’ll save $100 off your registration fee. To prepare you for the year ahead, a webinar on 2014 Joint Commission Standards and Changes will be held on Tuesday, December 10. Register for the webinar by clicking here.
The holiday season brings new albums, it has always been a time where big name artists release albums in time for holiday gift giving. For me, it has always been an exciting time when I would anxiously wait for some of my favorite bands to come out with something new. Sometimes I wouldn’t even wait to let the albums make my Christmas list! Being from Cleveland, the 80s were a time of great musical movement within the local band circuit. I will leave you with some my favorite songs from some bands from my hometown: click the YouTube links, turn up the speakers, and rock on! Check out Lover (sax solo by The Boss’s Clarence Clemons), Falling in Love Again, and He Can’t Love You, all by Michael Stanley Band (MSB); The Back of My Mind by Breathless; All By Myself and Lose Control by Eric Carmen; and finally Take It All by American Noise.
Rock on, my friends, and Happy Holidays!
Ed Yoder, MBA, MHA, RT(R), CRA, FAHRA is president of the 2013-2014 AHRA Board of Directors. He is the director of imaging services at Lexington Medical Center in West Columbia, SC and can be reached at firstname.lastname@example.org.