G. Edwin Howe
Retired president & founder, Aurora Health Care (Milwaukee, Wis.)
Former president, St. Luke’s Medical Center (Milwaukee, Wis.)
Former board member, Premier Healthcare Alliance
How will the economic downturn affect healthcare?
(1) Bad debts will soar as consumers get squeezed. (2) Hospital pension plans will be underfunded as the stock market tanks. (3) Capital dollars will not be there; or if they are, at higher rates. (4) Health insurance reserves will fall with the stock market, forcing insurers to raise rates. (5) Regardless of who wins this election, healthcare reform has been promised, yet the government has no new money and reimbursement will fall.
How should healthcare leaders respond?
Good care depends on good employees. Provide financial counseling. Gear up your employee assistance program.
The general public will be worried sick, literally. Yet they will avoid early treatment and detection, waiting till the problems can no longer be ignored. A new model may be required using support groups and providing interventions other than one-on-one care.
Do more with less. Only through rapidly adopting best practices and doing things right the first time can huge reductions in wasteful spending be made.
Engage the medical staff in demanding high quality and developing a plan for frugal medicine. We overuse expensive diagnostic testing. If 25 percent of over-utilization is reduced, the impact on the capital budget is reduced.
Information systems will be required to become more effective and efficient. Ask your group purchasing organization to take the lead in this area. GPOs are the best way to broker an effective system among information vendors, government and providers.
Be ready for the consolidation of healthcare. With the speed of light, the financial industry consolidated. I suspect healthcare will do the same.