In 2004, hospital chief executive officers fretted over
positions they couldn't find enough candidates to fill and struggled
to get along with doctors, but mostly, they worried about the budget.
Hospital CEOs surveyed by the American College of Healthcare
Executives chose "financial challenges," such as patients'
unpaid medical bills or Medicaid reimbursements, as their top concern
for the second year in a row, the Chicago-based professional association
reported last week. Budget concerns easily ranked highest on a list
of 11 major healthcare issues. Of the 480 CEOs who responded to the
membership survey, 71% said financial woes were among their top three
worries for the year.
The uninsured ranked a distant second. A little more
than one-third of respondents, or 36%, said uninsured patients-primarily
covering the cost of their medical care-was one of three greatest concerns.
Grappling with workforce shortages and physician relationships nearly
tied for third, with 33% and 32% of CEOs, respectively, naming those
issues as top concerns. Executives' concerns about quality and patient
safety landed low on the list, ranking seventh and eighth, behind worries
about government mandates. Patient satisfaction came in last.
Richard Henault, ACHE chairman and executive vice president
of Methodist Health System Foundation, New Orleans, said the emphasis
on financial worries highlights the mounting pressure that hospitals
face as expenses rise and reimbursement and insurance coverage decline.
" If you can't survive financially, if you can't
get access to capital, then all the other issues become moot," he
said. More uninsured and underinsured patients are pinching hospital
budgets as consumers struggle to pay bills, he said. Labor, technology
and drug expenses continue to climb, as do malpractice insurance costs. "It's
not a rosy picture," he said.
" It's an increasing financial challenge to run
an American hospital," said Thomas Dolan, president and CEO of
the ACHE, echoing Henault's analysis of the figures. Mounting financial
concerns overshadowed worries over the nation's shortage of healthcare
workers; that's in sharp contrast to 2002, when 71% of CEOs said demand
for workers was a top issue.
That doesn't mean a shortage of healthcare workers is
no longer a problem, Dolan said. Registered nurses topped the executives'
list of critical labor shortages; 87% listed demand for registered
nurses as the most pressing shortage, followed by imaging technicians
at 66%, and pharmacists at 54%. "I still think it's a major issue," he
said. "It's going to be a continuing concern."
Physician relationships, too, will be an ongoing concern,
cautioned Steven Messinger, a principal with ECG Management Consultants.
The percentage of CEOs surveyed who cited physician-hospital relations
as a top concern rose from 21% in 2002 to 26% in 2003 and 32% in 2004.
Hospitals' financial performance and clinical outcomes
are tied to the availability of specialists and the strength of management's
relationship with doctors, he said. On both counts, CEOs have struggled
in recent years.
Rising malpractice rates and a shortage of certain specialists
have squeezed revenue in some hospitals and prompted CEOs to revisit
employing physicians, a costly strategy that backfired for many hospitals
in the 1990s (See related story, p. 8). Hospitals face increasing competition
from entrepreneurial doctors in ancillary profitable services, such
as imaging or ambulatory surgery.
And too few doctors have leadership training to champion
changing technology or quality measures that executives see as essential.
Messinger said progress on these issues in the coming year is likely
to be mixed. "I don't think these have bottomed out yet," he
said.
