"The Ronan Report" provides insight about the activities at the Western Maryland Health System in Cumberland, Maryland, and about the changes taking place in healthcare today from a CEO's perspective.

Tuesday, April 30, 2013

Financial Condition of Maryland Hospitals

In preparation for how the Health Services Cost Review Commission is going to handle Sequestration cuts for Maryland hospitals, the Maryland Hospital Association asked for a report about hospital financial conditions to be done.  The results are telling.  The aggregate operating margin for Maryland hospitals is 0.8%, meaning hospitals are barely breaking even in the care that is provided.  Forty-two percent of Maryland hospitals have negative operating margins, resulting from four years of hospital rate increases (2010 - 1.49%; 2011 - 1.41%; 2012 - 1.56% and 2013 - .30%) which were below the inflation rates that exceeded 2% each year.  Hopefully, the HSCRC will take into consideration the seriously declining financial condition of Maryland hospitals at their meeting tomorrow as they are deliberating Sequestration cuts, as well as at their meeting in June about rate increases for FY 2014.

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