Financial Trends of Hawaii's Hospitals, Nursing Facilities, Home Care and Hospice ProvidersThis is the ninth year that the Healthcare Association of Hawaii (the Association) has issued Financial Trends of Hawaii's Hospitals, Nursing Facilities, Home Care and Hospice Providers. This year's Study was prepared by Ernst & Young and the Hawaii Health Information Corporation (HHIC). The 2007 Study highlights the financial issues facing Hawaii's healthcare providers, the benefit these providers bring to our community and the economic impact the healthcare industry has on our economy.
More specifically, the 2007 Study highlights the following:
- Hospital expenses continue to exceed net patient revenues and that trend has existed since 2000. Expenses exceeded net patient revenues by $150 million in 2006
- Hospitals have taken steps to control costs and improve the financial results, but expenses continue to exceed net patient revenues
- Hawaii's overall hospital payment percentage (92% of cost) is the lowest in the US
o Medicare reimbursed 79% of cost in 2006
o Medicaid reimbursed 80% of cost in 2006
o In 2006, other payors reimbursed 111% of cost compared to the average for the US of 125%
- Included in the costs is the cost to provide trauma services which exceeded payments by $29.5 million in 2005
- Included in the costs is the cost of caring for waitlisted patients. The number of waitlisted days has increased in every county over the past two years and results in significant uncompensated costs for the hospitals
- Included in the costs are the community programs provided by the hospitals at an average cost of $9 million a year above any payments received
- Included in the costs are costs for the teaching hospitals at an average of $20 million a year above payments received from Medicare
- Included in the costs are the bad debt and charity care incurred by the hospitals at an average of $107 million a year and the total bad debt and charity care continues to increase each year ($143 million in 2007)
- Payments from government payors also do not cover the cost of service for long term care and home health services. Medicaid payments to Hawaii's nursing facilities did not cover costs by $11 million in 2006
- Hawaii's healthcare industry plays an important role in our economy, as it is the 4th largest private industry in terms of gross domestic product
- The trickle down effect on Hawaii's economy is significant considering the wages that are paid and the amounts that are spent in Hawaii on other goods and services
- Healthcare also is an exporter of services in that the hospitals serve patients from outside Hawaii generating $63 million in payments for those services
The Study provides valuable information that is used by the Association in its meetings with the Congressional delegation, Governor, Mayors, Legislators and the public to educate them on the financial condition of Hawaii's healthcare industry. The Study helps emphasize the need for legislative and congressional action to provide better payments to Hawaii's healthcare providers for the services rendered. The healthcare industry is a vital part of Hawaii's economy but cannot be expected to continue to provide the current level of service without adequate payments. If the financial condition of the industry does not improve, Hawaii's healthcare industry could experience "the perfect storm".
Please use this valuable document to brief your Boards, Communities, Legislators and others. Contact Rich Meiers at 521-8961 should you have any questions or need additional information.
2007 Report (May take some time to download due to its size.)
2006 Report (May take some time to download due to its size.)
2005 Report (May take some time to download due to its size.)
2004 Report (May take some time to download due to its size.)
2003 Report (May take some time to download due to its size.)
2002 Report (May take some time to download due to its size.)
2001 Report
2000 Report
1999 Report
(You must have Adobe Acrobat Reader, which is free to view these reports.) |
