Excess beds: If you don't get rid of 'em, the state will

Coopetition. Wow, to an armchair observer like me it sounds really sweet--the idea that rival hospitals in a marketplace can cooperate efficiently rather than conducting the nasty 'ol arms race or maintaining unneeded beds.

Let's face it, though--most of the time it just ain't happening. In particular, we're not seeing mergers between financially-sagging hospitals that might take excess beds offline fast enough to have a short-term impact on costs.

As we've already seen, New York's legislature took a look at the situation and say "heck, if the marketplace won't take excess capacity out of the system, we will." That's been painful for all concerned, and who's to say that the commission involved made the right choices? Nobody, but if it was going to happen, someone had to do it.

Now, it's looking like New Jersey is headed in the same direction. While the state isn't demanding that certain hospitals close, it's decided that in some cases, it's not going to throw them a life preserver if they're drowning, which is almost the same thing.

Guys, you don't have to be a prophet to see the writing on the wall here. After decades of dickering over Certificates of Need (the front end), states are finally reaching the point where they're willing to take licensed beds out of the marketplace. As I've argued before, I believe New York and New Jersey are just the first movers--and that other states will ultimately make similar steps.

If your hospital is in trouble--and you've ever thought about mergers, shared operating agreements or the like--I suggest you not only consider it, you let your local state legislators and public health officials know you're doing it. Let them know you're pro-active. Heck, maybe if you show that you know how things are going, you'll be on your state's commission, rather than being named one of the "non-essential" hospitals doomed to be left to die. - Anne

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