Obamacare reduces reimbursements…so
Nurses, Administration, Physicians are losing their jobs. Ah…I was wondering
just who will be taking care of the sick?
A job engine sputters as
hospitals cut staff
Paul Davidson and
Barbara Hansen, USA TODAY 8 a.m. EDT October 13, 2013
Hospitals are cutting thousands of jobs, undercutting a sector that was a
reliable source of job growth, even through the recession.
Hospitals are reducing payrolls in the face of declining revenue even as
the new health care law expands health insurance to more Americans.
Story Highlights
- Hospitals face lower insurance
reimbursement
- New health care law encourages
fewer hospital stays
- Twenty-six states rejected
expanding Medicaid, a revenue source for hospitals
Hospitals, a
reliable source of employment growth in the recession and its aftermath, are
starting to cut thousands of jobs amid falling insurance payments and
in-patient visits.
The payroll cuts
are surprising because the Affordable Care Act (ACA), whose implementation took
a big step forward this month, is eventually expected to provide health
coverage to as many as 30 million additional Americans.
"While the
rest of the U.S. economy is stabilizing or improving, health care is entering
into a recession," says John Howser, assistant vice chancellor of
Vanderbilt University Medical Center.
Health care
providers announced more layoffs than any other industry last month — 8,128 —
mostly because of reductions by hospitals, according to outplacement firm
Challenger, Gray and Christmas. So far this year, the health care sector has
announced 41,085 layoffs, the third-most behind financial and industrial
companies.
Total private
hospital employment is still up by 36,000 over the past 12 months, but it's
down by 8,000 since April and more staff reductions are expected into next
year.
This month,
Indiana University Health laid off about 900 workers as part of a move to trim
its budget by $1 billion over five years. Vanderbilt plans to eliminate 1,000
jobs by year-end to help shave operating costs 8% a year. And the Cleveland
Clinic is offering buyouts to 3,000 employees as it shaves its annual operating
costs by $330 million.
"This is a
challenging time for the health care industry," says Jim Terwilliger,
president of two of Indiana health's hospitals. "The pace of change is far
greater than any time in recent history."
There are myriad
reasons for the cuts, which are affecting administrative staff as well as
nurses and doctors:
• Medicare,
Medicaid and private insurance companies are all reducing reimbursement to
hospitals. The federal budget cuts known as sequestration have cut Medicare
reimbursement by 2%, the American Hospital Association says.
• The health care
law has further reduced the Medicare payments to hospitals that provide
lower-quality service or have high readmission rates.
• The National
Institutes of Health reduced funding to hospitals by 5% as part of sequestration,
forcing hospitals to trim research staff.
• The number of
inpatient hospital days fell 4% from 2007 to 2011, in part because of the
economic downturn, the hospital association says.
• As more Baby
Boomers turn 65, their services will be reimbursed at Medicare rates that are
lower than those of private payers, putting further pressure on hospital
revenue.
The new health
care law was supposed to ease the burden on hospitals by expanding Medicaid
coverage to more low-income Americans, who often use hospital services in
emergencies then don't pay their bills. But 26 states, including Tennessee,
rejected ACA's offer of federal funding to expand Medicaid. That decision led
to about a third of the job cuts by Nashville-based Vanderbilt, Howser says.
Still, J.P.
Fingado, CEO of API Healthcare, a consulting firm for hospitals, says the
layoffs are shortsighted because the providers likely will have to add staff as
soon as next year to handle increased patient volumes resulting from the health
care law.
"The cuts are
a particularly short-term reaction," he says.
No comments:
Post a Comment