January 19, 2023 – More than half of U.S. hospitals were projected to operate in the red through 2022, according to a report by Kaufman, Hall & Associates, LLC, and released by the American Hospital Association (AHA) in September. The losses are in the billions of dollars, and rising expenses for supplies and workforce are elevating the pressures.
“Inflation’s leading to a lot of uncomfortable conversations between suppliers and health systems,” Peter Aftosmes, vice president of strategic supplier engagement for Premier, told an audience at IDN Insights East in Philadelphia, hosted by The Journal of Healthcare Contracting, this past fall. “We’re acutely aware of inflationary pressures due to all the data we have on supply chain. It’s a balance to strike. One of our primary responsibilities as a GPO is to protect our members from price increases.”
As suppliers pass on inflationary costs to health systems, Meena Medler, vice president of supply chain management for UPMC, says health systems don’t know where to pass it along.
“It’s a tough situation no matter the health system,” she told the IDN Insights East audience. “It’s leading to cutoffs in service for some remote patients. For example, dialysis service was cutoff in remote locations during Covid. What happens to those renal patients? Where are those patients provided care? This is happening at a time when the industry is saying it’s interested in population health.”
Read more in the latest issue of Repertoire Magazine.