State hospital associations, under pressure to document the damage caused by government cutbacks and managed care, have begun an unprecedented effort to collect financial data from their members.
And some of their members want the information to help executives explain to governing boards that they're not alone in financial struggles.
At least 12 state associations have released studies in the past year analyzing operating margins, measuring the impact of hospitals on local economies, and studying the adequacy of Medicaid funding. In most cases, outside paid consultants produced the studies.
In a separate effort that could transform hospital lobbying nationally, the American Hospital Association is endorsing national participation in a Web-based repository that collects monthly utilization and financial data. The Colorado Health and Hospital Association, which operates the program, called Databank, has licensed it to 31 state associations and expects to add four more by May.
Such information has become an essential tool at the state level. After two rounds of federal relief from Medicare spending restraints imposed by the Balanced Budget Act of 1997, hospitals this year have focused their lobbying on Medicaid funding and other state assistance.
Hospitals argue that they can no longer shift costs for uninsured and Medicaid patients to Medicare or private payers. At the same time, states are being squeezed by higher healthcare costs.
Anecdotal information "doesn't cut it anymore," said Jim Dixon, vice president of operations at the Louisiana Hospital Association, which recently commissioned a study on the economic impact of hospitals. It also will begin to participate in Databank this spring.
Dixon said nursing homes, physician organizations and pharmaceutical companies are releasing their own data in an effort to win a bigger piece of the state's Medicaid pie. Meanwhile, private hospitals in Louisiana are trying to counter assertions by the state's public hospital system that it is a low-cost provider.
"Crying and telling them we need more money just is not working," Dixon said. "(Legislators) are nailing us back with anecdotal data about our how wonderful we're doing. They see parking garages and expansions going up."
Performance data, often accompanied by dire predictions of service cuts and closures, are making a difference, hospital lobbyists say.
North Carolina's trade group, formally called NCHA-An Association of Hospitals and Health Networks, is using survey data collected by Deloitte & Touche to fight cuts to hospitals in both the Medicaid and state employee health plans, which face projected shortfalls.
"Our message to legislators is that of 111 acute-care hospitals in North Carolina, 38 will be operating in the red by 2002," said Don Dalton, the association's spokesman. The survey showed 35% of hospitals reported service cuts.
The Healthcare Association of Hawaii canceled at least two annual meetings in order to fund an ongoing study by Ernst & Young measuring the impact of the Balanced Budget Act, Medicaid cuts, Y2K expenses and costs to comply with the Health Insurance Portability and Accountability Act of 1996. Rich Meiers, the association's president and chief executive officer, said the approximate $60,000 to $80,000 cost of the initial study and a less expensive update has been well worth it.
The association is using the study this year as it lobbies for Medicaid dollars and a scholarship program to increase the supply of nurses. The data appeared in newspaper articles about the woes of the state's healthcare providers and prompted a favorable editorial in the Honolulu Star-Bulletin, he said. The data also helped persuade leaders in both chambers of the Hawaii Legislature to sponsor the association Medicaid relief package this year.
"We use (the data) constantly," Meiers said.
Hospital administrators are supporting data collection because they are under pressure from their boards to explain their own deteriorating finances, said Tom Fee, a principal in the healthcare consulting practice of Deloitte & Touche, which has conducted financial impact studies for associations in three Southern states and assisted a fourth.
"There's been a groundswell of CEOs saying, `What is anybody doing about this?' " Fee said.
That partly explains the rapid growth of Databank, which had just 11 states in 1994, said Peter Freytag, chief financial officer of the Colorado association. He said he expected 40 states to participate by year-end.
Notably absent from participation in Databank are the large states of California, Illinois, New Jersey, New York and Ohio, among others.
The program is intended to be used for both benchmarking and advocacy. Each state association pays a $5,000 licensing fee to participate, far less than the cost of commissioning a study by a national consulting firm. Online questionnaires take up to 45 minutes to complete, Freytag said
In 1999, the AHA provided seed money to put the program on the Internet, which made data collection and retrieval faster and more accurate. The money was provided as part of a two-year partnership agreement, in which the AHA agreed to help recruit new state participants. The partnership pact is being renewed this month.