Post-pandemic, state’s health care providers face financial, labor crunch
Dan McKay’s recap of the Legislative Finance Committee meeting to discuss New Mexico’s rural health care challenges was timely. This is an issue that impacts every hospital in New Mexico and has consequences for your access to health care.
The pandemic revealed the many strengths of our health care organizations and their resilient caregivers. It also revealed a seismic shift in the economics of providing health care services.
Today, New Mexico hospitals are struggling as they experience labor shortages, increasing labor costs, supply chain gaps, and inflationary pressures, not unlike other companies.
At CHRISTUS St. Vincent we are navigating this complex environment to sustain programs and services that our community needs, doing so at a time when we are caring for more in our community than before the pandemic. If you find difficulty getting a timely clinic appointment or wonder why waiting rooms are a bit fuller than they used to be, it’s largely because more of our regional neighbors are having to travel further to receive care here.
With roughly the same number of employees today as before the pandemic, this increased demand for services is happening at a time when our labor costs to ensure a competitive wage are 27% higher, our supply and pharmaceutical costs are 12% higher, and our hospital insurance premiums have increased over 110%, and in some hospitals over 200%, because of our state medical malpractice law.
New Mexico hospitals are having to make difficult decisions to consolidate, downsize, eliminate services, or close. Some rural hospitals have already eliminated less profitable services such as intensive care and labor and delivery, and others are reducing the number of beds available to care for patients.
As the safety net hospital for our region, we understand that there are services which our non-profit hospital would not offer or would curtail were they not subsidized from another aspect of our business. Our mission work includes subsidized services like labor and delivery, primary care, behavioral health, palliative care, charity care, etc. These are vital to having a comprehensive, full-service health care system in our community.
To navigate this complexity, we routinely scrutinize supply costs and utilization, cautiously monitor the size and growth of the workforce, and continuously assess all services. Because margins contribute to the financial viability of our non-profit health care system, as they do with any business, we ensure that we are billing for services with reasonable margins to help offset the costs of providing our comprehensive services and state-of-the-art facilities.
We support our rural hospitals and the communities they serve. New Mexicans should not have to travel great distances to receive care that can be reasonably provided close to home. And large health systems shouldn’t have to carry a heavier burden with the inadequate financial and limited human resources to do so. Rural hospitals are a vital partner in the delivery of regional care. We need each other to care for New Mexico.
NEW MEXICO HOSPITALS ARE HAVING TO MAKE DIFFICULT DECISIONS TO CONSOLIDATE, DOWNSIZE, ELIMINATE SERVICES, OR CLOSE.