A new study from the Falls Church-based Noblis Center for Health Innovation, a non-profit advisory firm to health providers, has found that hospitals and health systems across the country are cutting back on both capital spending and unprofitable healthcare services as a result of the economic crisis.
Conducted in late 2008, the Noblis Economic Impact Study assessed the impact of the national economic crisis on the financial health of hospitals and health systems in terms of: utilization, profitability, uncompensated care, philanthropy and fundraising goals, and the status of current and future projects.
The Noblis study found that the majority of hospitals experienced both dramatic losses in investment income and difficulty in finding fresh sources of capital.
Additional key findings include:
Operating profitability is a concern for many, but not all.
The greater concern was investment losses, which were significant over the past 12 months and disturbingly uncertain over the next year.
While overall profitability is a concern, most participants believe that utilization at their facilities will continue to grow.
Philanthropic fundraising in 2008 was buoyed by a rash of major “signature” construction projects.
Virtually all participants who had attempted to access capital or refinance in the past six to nine months indicated that obtaining capital was difficult.
- Two-thirds of the surveyed hospitals had already halted, resized, or changed major capital projects.