Increased Health Care Costs May Force California Hospitals To Reduce Services, Administrators Say
Increased health care costs have placed California hospitals under "increasing financial pressure" that could result in a reduction in services for patients, according to a panel of hospital administrators at a conference Tuesday in Santa Rosa, the Santa Rosa Press Democrat reports. At the annual health care conference, attended by 300 area medical and business leaders, hospital administrators said that their current 1% to 2% profit margins "are not sustainable over the long term" and could lead to reductions in programs and services for patients. Mike Cohil, CEO of Sutter Medical Center, said that increased pharmaceutical costs, labor shortages, expensive technology and a larger population of elderly patients will place "increasing demands" on hospitals in the future. He said, "Hospitals are in a bit of a crisis, but society has to decide what it wants out of its hospitals and what it wants to pay for." However, hospital administrators said the "financial situation is improving somewhat," the Press Democrat reports. They pointed out that health insurance premiums increased more than medical costs in 2001, a trend expected to continue over the next few years. Health insurance premium rates increased by an average of 11% in 2001 and will increase by 15% to 20% per year for the next two to three years, "slightly more" than medical costs, according to Marin General Hospital CEO Margaret Sabin (Rose, Santa Rosa Press Democrat, 11/20).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.