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Earnings up, utilization down – how this is the harbinger of things to come

Earnings up, utilization down – how this is the harbinger of things to come August 28, 2015

Marketing, research and business development consultant in healthcare, human services and senior living.

Earnings up, utilization down - how this is the harbinger of things to come
Hospitals are driving toward greater efficiency

The recent article in the Boston Globe which report financial performance of Massachusetts hospitals is a harbinger for hospital performance throughout the United States and will have far-reaching impacts. Because Massachusetts was the first state with an Obamacare type of health care system, how the system evolves in Massachusetts points the way. For employment, long-term care providers, local economies and even global healthcare providers, the performance of hospitals within the $2.7 trillion American healthcare system is too important to ignore.

Increasing efficiencies at hospitals will accelerate discharges, although of fewer patients. As hospitals become more scrupulous about which patients are “profitable” and which ones are not, there may be opportunities for other, niche providers. As the overall and per capita costs of the US healthcare system continue to rise, we can expect more social and political pressure, as well as greater levels of interest in lower-cost, high-quality foreign providers. And these growing hospital-based economic efficiencies will certainly further strain the already stressed relationships with physicians, nurses and other healthcare professionals.

Marketing, research and business development consultant in healthcare, human services and senior living.

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