June 2, 2010, WEYMOUTH, Mass.--(BUSINESS WIRE)--Healthcare management consulting firm Beacon Partners recently conducted a study of healthcare executives nationwide resulting in over 200 responding to a survey uncovering how their healthcare organizations have been impacted by the economy.
The survey revealed 50% of the participating healthcare organizations have had to cut back on IT investments due to the sour economic climate and reduced access to credit markets for financing.
"The survey results show that at a time when IT infrastructure investments are needed, the unstable economy has made it challenging for healthcare organizations to make those investments," said Ralph P. Fargnoli, Jr., president and CEO of Beacon Partners. "It's ironic that these organizations first have to spend money they don't have in order to receive future ARRA incentives, which, once received, won't cover their full investment. On top of this, healthcare reform legislation changes are expected down the line. Many healthcare organizations are uncertain as to how to make it all come together in time."
In fact, to make their budgets work, 80% of respondents have reduced capital expenditures and more than 40% have cut costs by reducing staff. As a result, employee turnover has increased by almost 38% due to the many negative moves the participating healthcare organizations have had to make as a result of economic pressures.
The study also found that over 80% of the healthcare organizations surveyed have completed strategic plans within the previous 18 months.
Not surprisingly, the disproportionate amount of uncompensated care was the single biggest ongoing problem that participating healthcare organizations are confronted with.
"It's interesting that while healthcare reform is on the one hand fueling the need to have strategic plans in place, it's also something that, if successful, should have a major impact on uncompensated care, thus positively affecting a hospital's ability to execute their strategic plans by freeing up available capital," continues Fargnoli.
Other highlights from Beacon Partners' study include:
- Three out of every four healthcare organizations surveyed are actively recruiting new doctors, and 40% claimed this was the single most significant organizational improvement they are undertaking to improve financial performance.
- 80% of the participating healthcare organizations have implemented service excellence initiatives.
- Just under 50% of respondents agreed that they will not see immediate benefits from the financial adjustments they've made due to the economy, but should start to within 1-3 years. 38% believe they will start to reap the benefits of their actions within the next 12 months.
- Just under 50% of the healthcare organizations are connected to private practice physicians, most being connected via portals. Two-thirds of respondents believe this connectivity with the greater healthcare community gives them a competitive edge.
- 51% of respondents feel that the issue of hospital/physician alignment strategies is the single most important initiative to improve their organization's long-term success.
Click here to view the executive summary and full survey results.
About Beacon Partners
As the largest independent healthcare management consulting firm in the country, Beacon Partners is chosen by organizations in the Healthcare Community to provide expertise in the adoption of information technology to improve overall operational and financial performance. With their strategic approach and depth of experience, Beacon Partners is uniquely qualified to help organizations navigate the challenges in healthcare and optimize their potential to deliver the highest possible level of patient care. This proven approach allows healthcare organizations to maximize their Enterprise YieldTM - the alignment of people, processes and technologies - with the important understanding that success depends on the ability to adapt quickly to issues pertaining to clinical transformation, revenue cycle management, interoperability, workflow optimization, EHR implementation and more. As the HITECH portion of the American Recovery and Reinvestment Act (ARRA) of 2009 becomes a priority to healthcare organizations, Beacon Partners' ARRA expertise helps organizations develop a roadmap that will lead to "meaningful user" status and maximize available incentives.