Too often these days we hear the death knell of healthcare being sounded. Hospitals are on the financial ropes, the uninsured are filling up emergency rooms, everybody is being sued or indicted, and new regulations are tying the industry in knots. The problem is, the news we keep hearing on the business side of healthcare is positive, so much so that the doom-and-gloomers are going to have to start looking harder for signs of Armageddon.
The truth is that the industry continues to function relatively efficiently, even creatively. The future has some troubling signs, to be sure, but I have seen that over and over again in my long career in the healthcare world, and each time the industry not only survives, it thrives.
This is a dynamic industry, and change always brings on anxiety. There are people who seem to love this kind of atmosphere, who thrive on bad news and use negative stories in the media to bolster their sense that the sky is falling. And these are people inside the industry.
I overheard one such person while checking in at a conference recently. This guy was wringing his hands over all the problems facing healthcare. "We're going to see a lot of hospitals closing" was his analysis. The man he was talking to told him not to listen to all the negativity. "Business looks great to me," he said.
This exchange brought back memories of an outstanding salesman I knew who sold advertising space for a major medical journal. He broke record after record each year and was always out in the field selling. He didn't waste a lot of time worrying about internal office politics, and he didn't waste time sitting in his office slurping coffee and exchanging idle chitchat.
At the time I was still fairly new to selling advertising space, but everywhere there was bad news in the papers and magazines about the pharmaceutical industry and how the government was going to move in and regulate it heavily. Then there was more bad news about how hospitals were going broke and that eventually there would be few hospitals left standing in this country. It was all bad news -- the articles appeared in the New York Times, the Wall Street Journal and in all the healthcare trade publications.
It was not a happy time and I wondered if I had chosen well in my career move. But my colleague straightened me out, saying, "Look, healthcare's always this way. It's always changing, and people are always making money on it. Our job is to sell ad space. There are bright people, people a lot smarter than us who will resolve many of these bigger challenges. Meanwhile, I am having a lot of success talking about my publication and why my clients should advertise in my magazine and sell more prescription drugs."
I've remembered that conversation ever since because I have a tendency to get off-track by listening too intently to the news about all the problems we have, so sometimes even I need to remember to look for the positive things that are happening.
It's really not all that hard to do. Healthcare is literally booming. New hospitals are going up; others are expanding. Technology keeps opening up new business opportunities. Of course, there are very serious problems in terms of access to capital, the ratcheting down of Medicare and Medicaid payments, physician and nurse shortages, and increasing government regulation. Yes, some hospitals are closing, but often because of poor leadership. And for every one of those problems, there are more things going right.
For instance, in the July 25 issue of this magazine, we ran a headline that read, "Healthcare's rosy outlook: S&P paints a healthy financial picture for hospitals" (p. 8).
In this piece we reported that "ratings agency Standard & Poor's issued three reports last week that together describe the healthcare industry as doing well and likely to keep doing so through 2006. Hospitals and systems have benefited from improvements in areas such as revenue growth, patient volume, cost containment and moderating growth in malpractice costs, which together outweighed negatives in areas such as rising bad-debt expenses, according to S&P reports. . . . The forecast for a favorable environment in 2006 is a change for S&P, which as of January expected next year to be when the federal government would act on Medicare's funding woes, cutting hospital revenue. . . . Nevertheless, median operating margins and cash positions among both stand-alone hospitals and health systems improved last year, according to S&P's analysis."
This is only the most recent of several articles discussing improvements in hospitals' bottom lines. And yet for many people it's actually easier to carry on bad-mouthing what is going on in healthcare. One reason for this is that it's an easy out for leaders looking to cover up their own management mistakes that have contributed to their organizations' poor performance.
You won't hear such talk from the many talented leaders and trustees who are working on continually improving their organizations. They know that today's healthcare marketplace is full of opportunities.
You just have to stop wringing your hands long enough to see them.
Things are looking up,