It costs too much, not in the budget

  1. For my own amusement and research (I love research), I decided to see just how impoverished the healthcare industry is. How valid is the response, "It isn't in the budget?"

    A stroll around the internet will educate you how healthcare costs are rising, services and expenses are being cut, but profits are soaring. Do your own search, then never again accept, "It isn't in the budget" or "It costs too much" as an excuse.

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    http://www.levinassociates.com/publi...enkshead02.htm

    "In the health care services segment, hospital company financial results continue to be strong across the board. It doesn't hurt that managed care companies have opened up the purse strings in the past few years, resulting in back-to-back double-digit premium increases for consumers. The largest hospital company, HCA, Inc. (NYSE: HCA), beat estimates for fourth quarter earnings by two pennies per share with a 25% increase on just an 8.7% rise in revenues. For hospitals owned for more than a year, fourth quarter admissions rose 1.8%, but the revenue per admission jumped by 9.8%. Cash flow from operations in the quarter increased 37% to $592 million compared to last year's fourth quarter."

    "Health Management Associates' (NYSE: HMA) profits for its first quarter ended December 31, 2001 rose 26% on net revenues of $495.8 million"

    "LifePoint Hospitals (NASDAQ: LPNT), which was spun out of HCA, posted a 68% increase in earnings per share for the fourth quarter. "

    "Universal Health Services (NYSE: UHS) expects to report a 32% increase in earnings per share for the fourth quarter"

    "Humana (NYSE: HUM) slightly beat estimates with a 32% fourth quarter increase to $35.1 million."

    "UnitedHealth Group (NYSE:UNH), the second largest health insurer after Aetna (NYSE: AET), reported a 28% rise in fourth quarter profits and beat estimates by three pennies per share."

    http://www.diffenbaughassociates.com...r/current.html

    UnitedHealth Earnings Jump 46-%
    UnitedHealth Group Inc. , the managed health care company, said on Thursday quarterly profits rose

    HCA Profits Up 25-%
    HCA Inc. , the largest U.S. hospital chain, said quarterly profits rose 25-% from last year...

    UHS Q2 Earnings Up 35-%
    Universal Health Services, Inc. announced that its net income and earnings per share (diluted) were $44.3 million...

    HMA Posts Record Q3 Earnings Growth
    Health Management Associates, Inc. announced that its net patient service revenue grew a robust 25-% to $592.5 million...

    Humana Profits Up 19-%
    Humana Inc. reported earnings of $45.4 million, or 27 cents per diluted share, up 19-% from the same period a year ago . . .

    Anthem, Inc. is an Indiana-domiciled publicly traded company that, through its subsidiary companies, provides health care benefits and services to more than 10 million members. Anthem is the fifth largest publicly traded health benefits company in the United States and is the Blue Cross and Blue Shield licensee for Indiana, Kentucky, Ohio, Connecticut, New Hampshire, Colorado, Nevada, Maine and now Trigon in Virginia (excluding suburbs adjacent to Washington, D.C.). As of December 31, 2001, Anthem had assets of $6 billion and operating revenues of $10 billion . . .

    UnitedHealth, based in Minneapolis, also raised earnings expectations for the full year and is now estimating profit growth in excess of 30-% over 2001. The company said second-quarter earnings rose to $325 million, or $1.01 per share, from $223 million, or 68 cents a share, a year earlier. Wall Street analysts had expected earnings of 93 cents to 97 cents, with a mean estimate of 95 cents, according to research firm Thomson First Call. The results marked UnitedHealth's 15th consecutive quarter of double-digit profit growth, according to Lehman Brothers, a trend analysts expect will continue through at least 2004. . . .

    Health Management Associates Reports Record 3rd Quarter EPS Growth of 24-%
    Health Management Associates, Inc. announced that its net patient service revenue grew a robust 25-% to $592.5 million for its third quarter ended June 30, 2002, up $119.3 million from $473.2 million for the same period a year ago. The Company's net income for the quarter increased similarly, up 23-% to $66.6 million, an increase of $12.5 million from $54.1 million for the same quarter a year ago. Earnings per share (diluted) for the quarter were $.26 per share, up 24-% from $.21 per share for the prior year's quarter. . .

    HCA Profits Up 25-%
    HCA Inc. , the largest U.S. hospital chain, said quarterly profits rose 25-% from last year on higher occupancy and patient fees, and controlled labor costs. Second-quarter net income rose to $350 million, or 66 cents a share, from last year's $281 million, or 52 cents a share. . . In controlling costs, company executives said on a conference call that they reduced their use of agencies that provide temporary nurses. As such, salary and benefits costs fell slightly to 40-% of total second quarter revenues from 40.7-% a year ago.

    LifePoint Hospitals Reports 54.5-% Increase in 2nd Quarter 2002 EPS

    http://atlanta.bizjournals.com/atlan...03/story3.html
    HMO profits rise in first quarter

    Other Georgia HMOs, including CIGNA Healthcare of Georgia, United Healthcare of Georgia and the Kaiser Foundation Health Plan of Georgia also had dramatic profit increases.

    http://www.newsfactor.com/perl/story/7701.html
    IBM and Lawson Target Health Insurance Market
    The goal is to provide a management system that reduces healthcare costs, increases profits, and forges stronger customer loyalty and satisfaction, the companies said.

    http://www.newsday.com/news/columnis...s%2Dcolumnists
    Perversely, the explosion in health care costs and in the number of uninsured is occurring at a time when overall inflation has fallen to some of the lowest levels experienced in 30 years. Meanwhile, it seems more than a coincidence that shares in managed-care companies are doing quite nicely. The Standard & Poor's managed health care index has doubled since 1999, a period when the broad S&P 500 stock index fell by one-third.
    Last edit by Youda on Oct 9, '02
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  2. 17 Comments

  3. by   oramar
    They got the fox in charge of the hen house and the fox will always tell you there are not enough chickens.
  4. by   renerian
    I heard that alot in home health since the supplies are now bundled with the payment so agencies have to supply them. Our agency turned down alot of referrals if the wound care supplies were expensive. They of course had no money to hire full time case managers, then they would have to pay benefits, so they only hired per diem nurses. They were still pocketing over 100,000 per month which I think is good for net profit for a small agency.

    Just my thoughts,

    renerian
  5. by   Youda
    When I have some time, I'm going to post how much money these outfits are paying to professional lobbyists in Washington to prevent any legislation that curtails their greed and could benefits nurses or their patients.
  6. by   sjoe
    If a staff nurse thinks of it, "It's not in the budget."

    If an administrator who has NO direct healthcare experience thinks of it, "It's worth a try. Let's design an expensive pilot project (without first consulting the people who will actually be doing the work of course)."
  7. by   abrenrn
    I love these boards. All I see in health care is penny-wise pound foolish.

    Remember about 7-10 years ago when, on the advice of highly paid consultants, they laid of many, many RNs because we were so expensive? Something I don't think the public knows about is that and the fact that the same hospitals ended up losing a fortune on increased complication rates and infection rates. So now they need nurses again, seem a bit miffed that all those that were laid off are not standing outside their doors, waiting to come back in. They complain that there are no nurses so the government wants to give THEM money to figure out how to fix what they had broken.
    For those who remember, this was post eighties shortage, when hospitals actually responded with money and pay for experience in some places. The same type of people who told me I was to smart to go to nursing school started telling me how smart I had been and, I believe, applications and enrollments skyrocketed.
    Then layoffs, no jobs for new grads, no new students, no nurses, and the hospitals need financial help to figure it all out.
    Duh.

    Anne
  8. by   suzannasue
    Ah,yes,have worked for one of the corporations you listed and was amazed at the profit they made in 1993...enough to send the head honchos and spouses to Morrocco for a retreat.
    One year,our nursing budget was cut into the marrow...we were short staffed and if you had to make overtime, nursing management was looking over your shoulder asking when you were going home and telling you to hurry and get offa the clock...supplies were nonexistent...in fact, we saw our supplies leaving in the hands and arms of management and when we tried to ask them why they were taking our supplies,we were told there was too much revenue locked up in the supplies at hand, we could re-order the supplies on demand but they had to get rid of the high dollar inventory...a hiring freeze was implemented...we were all sick and tired of the environment in which we had been working. We came to work one day/night being greeted by the big dogs from corporate headquarters. We were told our DON had been elected the nursing leader of the year by corporate and although they could not tell us exactly why she had been chosen we found out from her lips that her efforts to control costs had won her the honor and a monetary prize of $250,000!!!!!!!!
    To this day, I cannot hear the name of that corporation without cringing, knowing that they have a poor pay scale for nursing staff yet they can claim the big profits for the management as a result of staff working in such a poor mouthing environment.
    Thanks Youda, for this posting of the information regarding these coporations...I believe this should be on the front page of every newspaper in the USA....perhaps the citizenry would hear what we are sayng !!!!!!!
  9. by   sjoe
    Anne--exactly right. welll put.
  10. by   frankie
    Youda and everyone else posted here - I have to get this off my chest - venting a bit. I work in an out patient IV therapy clinic as a nurse, but I am a pharmacy employee - therefore managed by PharmD. We are moving to a newly built unit - and you guys have to know we do alot of therapies - PICC/ML insertions, blood and blood product admin. - biologic agents, IVIG, IVHEPB, Amifostine, Iron, first dose ATB, chemo, - just about everything- anyway we are moving to this new area built for us and the manager does NOT WANT TO PURCHASE A CODE CART OR A STRETCHER/BED for us. Now, I believe in conserving dollars, but get real - we need a code cart - he said - "JUST GO DOWNSTAIRS AND GET ONE IF YOU NEED IT". I wouldn'g want to be that patient. About the stretcher, he said "THERE ARE THREE IN THIS BUILDING, THAT'S RIDICULOUS. YOU CAN BORROW ONE IF YOU NEED ONE" We use the stretcher daily - PICC insertion ect.. anyway - we make money - we turn a profit on this operation - at a not for profit hospital - with lots of foundation money - this has just put me over the edge today. I will persue this tomorrow with this guy. Thanks for listening. frankie
  11. by   whipping girl in 07
    A CODE CART AND A STRETCHER ARE NOT IN THE BUDGET???

    What about the person who has an anaphyllactic (sp?) reaction to any of the IV products you administer? Do they really think you have time to "run DOWNSTAIRS" and get a crash cart to intubate a patient before their airway closes off? How are you supposed to get it UP the stairs anyway? Or do you have to wait in line for the elevator? Are they going to wait until after it happens and they settle on a huge lawsuit before they address this problem?
  12. by   frankie
    Konni, I had to bite my tongue and sit on my hands - the words that wanted to come out of my mouth. I will take on this problem tomorrow or next week Monday. Thanks for the support.

    frankie
  13. by   adrienurse
    Ain't the private hospital industry grand! At least you can find out these hard numbers. Even the Gouvernment of Canada has no idea how much money it puts into the Canadian Medicare system, let alone how much of that is not being used to decorate corporate offices of hospital CEOs. Disgusting.
  14. by   Youda
    I spend too much time reading. I ought to get a life!

    In RN Magazine, October 1988, there is a very interesting article entitled "When profit motive threatens patient care," by Helen Lippman Collins. Excellent article if you can dig it up somewhere.

    Picking out some interesting data:
    74% of nurses (in 1987-1988) felt that cost cutting made it impossible to have a caring attitude.

    The percentage of nurses. . .
    76% of ER nurses felt there was a deterioration of care.
    86% of geriatric nurses felt there was no time for a caring attitude.
    45% of psych nurses felt patients needing treatment were turned away.

    The higher number of years of experience in nursing resulted in a more informed recognition of problems, and the more time as a nurse meant a higher percentage of nurses who believed there was a deterioration of care.

    The biggest cuts in staffing were reported by proprietary, public, and non-profit hospitals, respectively.

    The article recommends (p.79):
    ". . .urges nurses to keep documenting dangerous conditions -- short-staffing, lack of proper equipment, inappropriate discharges, or whatever. . .acknowledges that it's hard to do this when nobody seems to listen . . . nurses can build on that by digging out hard data and sharing soltuions. The new law is to do your homework. Somebody somewhere has already invented the wheel. . . .write nurses where they addressed that problem. . .it's true that many of these problems are not going to change today or tomorrow, but we've got to use these issues to get some kind of dialogue going and to get nurses on those hospital policy-making committees. . .if you're waiting for someone to come along and hand you a basket of power, it's not going to happen.. . .the battles of cost over quality can be resolved ethically with a large dose of the basic nursing tenet that puts patients first -- and only nurses can inject this solution into the health-care system." (snipping and paraphrasing mine).

    Good article. It was written in 1988, but very apropo for today.
    Last edit by Youda on Oct 10, '02

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