ARTICLE OF THE WEEK |
||
Washington Report |
||
Impact of Economic Stimulus Policy on U.S. Healthcare |
||
| Mark Reiboldt* | ||
| Even before Barack Obama was sworn in as the 44th president of the United States, the speculation about what would happen with the proposed economic stimulus package was swirling throughout Washington. One of the largest provisions of the $900 billion-plus spending plan related to strategies for implementing and improving the breadth of technology within our nation’s healthcare delivery system, with specific focus on electronic medical records. While there is still a great deal of debate among economists about the long-term efficacy of the stimulus package in helping the economy as a whole, many healthcare providers and technology companies are looking forward to the more than $30 billion that is expected to be allocated to the implementation of new healthcare technologies. The proposed spending increases aimed at healthcare information technology (HIT) are very encouraging for patients, providers, and the healthcare sector at large. A number of companies will no doubt benefit from the plan; however, the real beneficiaries that policy makers are aiming to help are healthcare consumers (i.e., you and me). Because the likelihood of the plan passing is high, the key objective for stakeholders within the healthcare industry is to make sure the funds in the stimulus are allocated to the most beneficial and efficiently planned implementation strategies and programs. While the verdict may be out on whether or not the increase in deficit-financed spending will stimulate the economy, one thing we do know for sure is that if such an effort gets bombarded with “political pork,” without addressing the heart of our economy’s needs, then we can rest assured that the stimulus will not work. As such, we must make sure we do everything possible to eliminate possibilities for failure now that we’re seeing the stimulus being put into action, and focus on how we can make this effort effective for the long-term sustainability of the U.S. and global economies. Giving physicians the ability and flexibility to expand their use of technology will no doubt have dramatic effects on improvement in quality of care within the healthcare system. These efforts will save money and, more importantly, save lives, as former-Speaker of the House Newt Gingrich has been talking about for a number of years now. Indeed, a recent study published in the Archives of Internal Medicine released new data showing the positive impact of HIT on reducing mortality rates in hospitals.1 Furthermore, this issue does not just relate to the benefit for the healthcare sector; the advantages of this expansion will have a dramatic effect on macroeconomic recovery, in that the healthcare sector will benefit from these new funds that will ultimately be aimed at maximizing their productivity while saving on significant investments. The improvement in the quality of care is an added bonus for all stakeholders involved. Speaking of hospitals and technology, the credit crunch has continued its relentless hold over dynamics in the *Director, The Coker Group; phone: 678-832-2004; e-mail: markreiboldt@cokergroup.com. Copyright © 2009 by Greenbranch Publishing LLC |
healthcare marketplace, with the brunt of the negative impact being felt by the heart of the nation’s healthcare delivery system. It is no secret that hospitals have had no relief in this financial crisis, despite any hope of economic stimulus, a new Administration in Washington, or talk of potentially bottoming markets. According to new survey data released by the American Hospital Association, hospitals are continuing to “hunker down,” specifically in their plans to dramatically reduce investment expenditures and take steps to improve their bond ratings in overall hopes of gaining access to the dwindling credit markets.2 The key trend in the latest data, which include feed-back from almost 700 hospital executives throughout the United States, relates to the fact that hospitals are drastically tightening their spending plans for 2009–2010. Perhaps this isn’t surprising; however, it is very important to look at where the spending restrictions are taking place. Sixty-two percent of hospitals participating in the survey responded that they will put projects on hold that relate to spending on new IT systems. Further, 65% said they would hold back on investment in new clinical technology projects. This is a critical trend, because with the $30 billions pending increases aimed at HIT in the stimulus package, it is still too early yet to say whether or not these increases will be able to stimulate the 63% decline in hospitals’ spending and reverse the scenario. If not, the spending proposed by the White House will have little short-term effect. While all of these data are very compelling, perhaps the most critical fact derived from the survey was that 67% of hospitals that put clinical information technology projects on hold said that this drastically decreased opportunities for improving quality and patient safety. In a system in which quality is already in question and when there is discussion of reimbursement structures based on quality, if providers do not have the tools to achieve a measurable level of quality, any spending plan, regardless of the amount of money thrown at the problem, will likely lead to very few significant results. Ultimately, the consensus is that 2009 will prove to be just as difficult as (if not more so than) 2008. The current outlook is certainly grim. However, with a new Administration in place and a new Congress convened, there is already movement on the healthcare policy front, which is perhaps evolving into a revived sense of hope in the prospects for recovery. From a policy making standpoint, the key objective now is stabilization. However, once that step is taken, we can look toward new policies that will present opportunity for long-term sustainability as the healthcare industry recovers and emerges stronger than ever from this crisis.? REFERENCES 1. Amarasingham R, Plantinga L, Diener-West M, Gaskin DJ, Powe NR. Clinical information technologies and inpatient outcomes: a multiple hospital study. Arch Intern Med. 2009;169:108-114. 2. American Hospital Association. Report on the Capital Crisis: Impact on Hospitals. January 2009; www.aha.org/aha/research-and-trends/index.html. |
|