Why should hospitals be "run like a business?"

1,631 Views | 5 Replies | Last: 5 yr ago by dimitrig
TandemBear
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Now I understand most of them enjoy "non-profit" status, but that isn't the issue. Why are they expected to be self-supporting? Or run "in the black?" I understand Seton Medical Care filed for bankruptcy protection in 2018, affecting several locations. Residents of Daly City are concerned about their Seton Medical Center closing. And this is nothing new. Hospitals around the state have been encountering all sorts of financial hurdles. (Then again, a lot of them have just rebuilt amazing new campuses...)

Which begs the general question, why would be expect a hospital to be a "profit center?" Or at least be self-sustaining?

Do we ask other vital public services to "operate in the black?"

Public Schools
Fire Departments
Police Departments
Libraries
Parks

So why are hospitals, a vital societal function, expected to operate in the black? Aren't we just setting ourselves up for failure by accepting this expectation? And aren't we doing same by approaching health care policy in general?

For example, being TRULY prepared for a pandemic means a LOT of cost. A lot of spending on all sorts of things that may or may not get used this year, this decade, or even this generation. But many would say it's prudent to spend these monies so IF the worst-case scenario happens, we're ready. Ebola probably will never cause an epidemic here, yet we've spent monies to reduce the risk.

But having an "overstaffed" or "over prepared" hospital is a luxury I think we can and should afford. That way when the unexpected happens, we can handle it and provide excellent care.

Higher public spending to bolster our health care infrastructure so we're more prepared for pandemics is a good idea. I understand there is still a nurse shortage in the state. Haven't we heard this for over a decade now? Well, if hospitals are forced to be "run like a business," we will NEVER get ample nurses. If we feel compelled to run hospitals "lean and mean," then we'll NEVER have happy nurses who aren't overworked and stressed out.

I don't think as much of our society needs to be run this way. Why does the American worker have to be "fully (or over) utilized to maximize return?" What's the point if we're all working under such stress? Is THAT supposed to be part of the American Dream? I don't think so. But this moves the discussion into other political minefields that I should probably avoid.

So to keep my post focused, why can't hospitals simply run at a loss, knowing they're providing a critical social function that's more than worth paying for? So what our hospitals run "at a loss." Their job is to provide medical care, not impress an accountant with its balance sheet. Sure, keep checks in place and make sure every hospital provides value, yet at the same time lucrative jobs. Both can exist at the same time.


PS I'll add that when my father entered medicine, he said there was no such thing as a hospital CEO. And I'm going to guess that hospitals didn't have business/administrative staff and positions that they do today. They DEFINITELY didn't have IT or website design departments! So why are we allowing a health care entity to balloon its "business services" departments when they simply are not providing actual health care? Sure, it's nice that your hospital has an impressive website, but is that really necessary? Stanford Medical care centers are looking more and more like high-end spas than medical clinics. Is this really necessary? Sure, it's nice, but shouldn't these amenities come AFTER the basic function of health care is met first?

dimitrig
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There are public hospitals like County/USC.

Do you think there is no role for private hospitals?




TandemBear
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dimitrig said:


There are public hospitals like County/USC.

Do you think there is no role for private hospitals?





Yes there are, but they exist within a framework where private enterprise dominates. Their doctors must be recruited, buy their drugs, their medical equipment, and all the rest in a pretty much free market environment with little to no price control. So these "public hospitals" are not performing as efficiently as they could if they could operate within the cost controls afforded by a single payer model.

Not once did I say that. But if you let them compete with a public option/single payer model hospital, how well will they fare? I don't know the answer.

But Germany's Bismarck model of health care seems to combine private enterprise with socialized medicine pretty well. Not perfect, but they provide universal care for less than we spend per capita.
sp4149
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TandemBear said:

dimitrig said:


Not once did I say that. But if you let them compete with a public option/single payer model hospital, how well will they fare? I don't know the answer.

But Germany's Bismarck model of health care seems to combine private enterprise with socialized medicine pretty well. Not perfect, but they provide universal care for less than we spend per capita.
The president's Buy America program is the reason testing was delayed. The rest of the world was using a German test, but The Grumpo administration wouldn't allow it's widespread use. At the press conference they touted that the "American' test under development would be more accurate than the 'German' test has proven. Pretty bold statement considering that it hasn't completed development and wide spread testing. At what point will our country's leaders acknowledge that the rest of the world may be equally competent.
Tedhead94
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Quite simply because there is a prevalent belief that health care is not a right - and in a capitalist society that leaves only one other option - $$$
dajo9
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Tedhead94 said:

Quite simply because there is a prevalent belief that health care is not a right - and in a capitalist society that leaves only one other option - $$$


Somehow health Care is a right when you turn 65.

I don't believe it's a right. I just believe we can afford it and it's the right, moral thing to do.
dimitrig
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TandemBear said:


Yes there are, but they exist within a framework where private enterprise dominates. Their doctors must be recruited, buy their drugs, their medical equipment, and all the rest in a pretty much free market environment with little to no price control. So these "public hospitals" are not performing as efficiently as they could if they could operate within the cost controls afforded by a single payer model.

Not once did I say that. But if you let them compete with a public option/single payer model hospital, how well will they fare? I don't know the answer.

But Germany's Bismarck model of health care seems to combine private enterprise with socialized medicine pretty well. Not perfect, but they provide universal care for less than we spend per capita.

This is a little bit different argument and one I had not thought much about before now.

However, overall I would say that the free market works a lot better than any sort of command economy. I can't imagine it is the free market which is hindering efficiency.

I think a big problem with health care is that it is a free market, but not an efficient one. People can't easily switch between insurance providers. People don't know up front what their costs will be and can't easily compare it to other providers - especially when the level of care might be different in subtle ways.

This leads to lots and lots of inefficiencies in the market. To me the issue isn't that the public hospitals are competing in a free market environment as much as that the free market itself is being manipulated by insurance companies. Get them out of the picture and let the market work. I agree with that and that is why I support single payer.



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