From staffing shortages to supply chain costs, several economic factors are placing burdens on health practice profitability heading into 2024.
Six healthcare leaders recently told Becker's why supply chain issues and cost containment burdens are among the top trends they are eyeing right now.
"We are watching the increase in costs (labor and supply) as compared to the increase in reimbursements." — Andy Paulson. Executive Director at Central Illinois Endoscopy Center (Peoria).
"Cost containment. While always important, implant/device cost management is more important than ever. Margins continue to erode as the cost for employees and supplies escalate. Supply chain is at the forefront." — David Jevsevar, MD. CEO at OrthoVirginia (Blacksburg).
"As an ASC leader in the current economy, I am watching the cost of supplies and materials continue to rise. In an attempt to circumvent the decreasing profit margins as the cost of supply rises, we need to be always on the lookout for better pricing and create competition between vendors." — Emily Spooner. CEO of South Florida Same Day Surgery Center (Pompano Beach).
"As a single-specialty, GI/endoscopy/gastroenterology diagnostic ASC, the supply chain and market have changed from "pre-COVID" to note, prices and allocations. We know that shortages, recalls, or anything that interrupts availability of our supply inventory can affect us almost on the spot. I find myself watching for news and updates related to GI/endoscopy supplies to ensure we can anticipate needs and possible alternatives in order to prevent any interruption of services. This can be in procedure-related supplies as much as medications or patient care supplies." — Emma Gimmel, BSN, RN. Director of Nursing at Manhattan Endoscopy (New York City).
"The shrinkage of operating margins: The shortage of staff, rise in salary requirements, change in the market for non-traditional nursing roles, continued non-parity of reimbursement versus acute care and supply chain challenges continue to strain the ASC smaller businesses. These businesses have to pay the same expenses for labor and goods as the hospitals, but make less profit in many instances." — Jason Goodwin, RN. Associate Professor of Nursing at Sacramento (Calif.) City College and Surveyor at AAAHC.
"Reimbursement continues to be a focus, especially with rising staffing and supply costs. Another trend worth watching is if early career MDs are motivated to invest in an ASC as in years past. If returns continue to drift downward, it may become a challenge to find new investors as late-stage MDs phase out of the workforce." — Omar Khokhar, MD. Partner at Illinois GastroHealth (Bloomington).