More people are avoiding hospitals for medical care

Pittsburgh Post-Gazette

When it comes to getting medical care, a growing number of people are avoiding hospitals.

There are exceptions, but consumer cost pressures, urgent care centers and drugstore clinics are taking hospitals’ lunch money as they scramble for ways to cut costs, merge with bigger systems and otherwise partner to provide medical services to keep the lights on. The trend isn’t new.

But now, a report by a Warrendale-based trade group points to health insurers as a big part of why hospitals are losing their luster. The reason is simple cost-cutting, according to the Healthcare Council of Western Pennsylvania. Blood work, medical scans and other services cost less outside of the hospital, so insurers send their customers elsewhere.

“You’re living off your balance sheet,” said Denis Lukes, CFO of the Healthcare Council of Western Pennsylvania. “In the long term, that’s not sustainable. A lot of these community hospitals are just trying to survive.”

Highmark spokesman Aaron Billger defended the Pittsburgh insurer’s cost-cutting efforts, saying that consumers are becoming smarter about health care choices while the quality of care has improved.

“The quality of our members’ care has increased while these inpatient stays have decreased, and this has led us to acknowledge that our members are getting better care,” Mr. Billger said in a statement.

Hospital admissions in Western Pennsylvania were off 2.74 percent to 486,617 in fiscal 2018 from 500,310 in 2017, a survey of 62 hospitals by the Healthcare Council found.

Inpatient surgical operations slipped 4.3 percent during the same period. At the same time, emergency room registrations fell 3.4 percent to 1.7 million in 2018.

Even as the average hospital revenue from core medical services ticked up to 4.6 percent in 2018 from 4.3 percent a year earlier, the Healthcare Council says more than half of the 62 hospitals surveyed, or 53 percent, saw operating margins sink over the past year.

At Washington Hospital, for example, admissions fell to 11,432 for the year ending June 30, down 8.6 percent from the same period in 2017. Emergency department admissions dipped 3.7 percent.

Inpatient surgical cases slipped 1 percent for the year, 2,233 in 2018 versus 2,257 a year ago.

Fewer surgeries and the drop in admissions translated into a 3.2 percent loss in operating revenue at Washington Hospital for the year — $240.4 million in revenue in 2018 compared with $248.4 million in 2017.

“The long-term trend line has been going down for a long time,” Washington Hospital CEO Gary Weinstein said. “The regional decline in inpatient admissions, surgery, ER admissions — that’s consistent with what we’ve seen here.”