However, for the hospital industry, Halloween is coming earlier than ever, and it’s staying a lot longer than one night.
Scary words and concepts like “zombie hospitals,” “ghost hospitals,” “living dead hospitals,” “hospital deserts,” “hospitals in death spirals,” “shell hospitals,” hospital system “Potemkin Villages” (history and film buffs, look it up), et al., are very much alive, frightening patients and hospitals, while experiencing monstrous growth spurts. (The growth spurts would be even greater if so many of these almost-dead hospitals hadn’t already died off and disappeared or converted to physician offices or condos.)
We’re months away from October 31st, but for hospitals, the horrors, deprivations, and immiserations of late October are coming earlier, more roughly, and now never-ending and/or getting worse, as if that’s possible.
A growth industry of a ghost arena may sound like an oxymoron, but it’s painfully real. For example, the administration’s latest budget plans call for an additional $200BB in cuts in health care in addition to the OBBBA’s death-conspiring negativities. Meanwhile, 734 rural hospitals are currently at risk of closure. And as predicted, the CMS annual inflationary pay bump for 2027 is 50% below the rate of inflation. No or value-declining patient coverage, while rural patients have the highest out-of-pocket payments, leads to a lack of fully functioning or faintly functioning hospitals. This can be a death sentence, characterized by declining life expectancy for patients and hospitals.
Those most susceptible to this permanent Fright Night are rural/small/independent hospitals with net patient revenues (NPR) below $60MM and days cash on hand (DCOH) of less than 60 days, with consecutive years of negative ops margins.
The core central dynamic of this spectral devolution for these very vulnerable hospitals is declining revenues/cash. The only cure for this crushing epidemic of subtracting cash is more cash for these fragile hospitals. There are many hundreds of these hospitals.
TRUE or FALSE?
Let’s better acquaint the reader with these dire straits for current and approaching hospital socio-economic life. Here are four true/false questions and their answers on disastrous revenue depletions, manufacturing a permanent and crushingly real Hospital Halloween. They feature closed and almost-closed hospitals with highly constricted and contracted services and staffing and the walking-dead zombie hospitals and their related, similarly burdened facilities.
Just because a hospital is not buried doesn’t mean it’s not dead:
1. A “zombie hospital” is often a “de jure” hospital, as based on law and regulation. But it’s not a “de facto” hospital, i.e., a hospital based on commonly accepted operations, service facts, functionings, and standards. TRUE
The zombie hospital population is rapidly growing, as available hospital cash is proportionately declining. There are now some so-called “functioning” hospitals with negative days cash on hand. The more days cash on hand declines, the more services and staff are contracting, if not to the point of absolute closure. Then, in an effort to save political or financial face, the hospital is reduced to a facility perhaps with a license or some such formality, but with zero admitted or served patients, or maintaining less than a 5%–10% occupancy. These hospitals are not listed as closed.
2. The Steward hospital system, consisting at one time of 31 hospitals spread across the US, is the largest hospital system to be considered a “zombie hospital system." TRUE
While the vast majority of “zombie hospitals” are rural, small, and/or independent, there are some sizable systems that have fallen under the control and/or manipulations of REITs and other for-profit, private equity financial management systems/companies that have effectively put these hospitals into “death spirals,” reducing large hospital systems to a system of “zombie hospitals” or “Potemkin Villages.”
3. The infamous Steward hospital system devolved into its apparent zombie-like status, as it was so called in court filings. Its contracted payers/carriers believed that the Steward system hospitals were in such a weakened state financially, legally, and operationally that payers could allegedly and purposefully underpay and deny Steward’s rightful reimbursements, effectively removing from Steward its accurate claims reimbursements. Steward payers/carriers appeared to believe that Steward couldn’t and wouldn’t effectively contest payers’ inaccurate non-payments and underpayments. TRUE
There are many paths or death spirals for a hospital or hospital system of any size to take to become zombie-like or a Potemkin Village. There is a devastating spectrum from federal/state coverage/reimbursement butcherings, as reflected in federal budgets and laws (cf. OBBBA), to national for-profit management firms selling their expensive, cash-depleting services, e.g., REITs, for get-rich-quick dangerous schemes, at hospital expense.
4. It’s very rare for a “zombie hospital” or a “hospital desert” to evolve/resolve back into a de jure and de facto hospital. TRUE
The profoundly negative structural, financial, political, and cultural effects zombie or ghost hospital status induces are too overwhelming for a hospital to reverse and recover from.
WHAT IS TO BE DONE?
So, what’s to be done to prevent and cure creeping hospital zombie-ism and hospital living-dead syndromes?
The missing “bloodstream” necessary to prevent these above fatal/near-fatal processes is centered around what these hospitals have lost or are missing,namely a growing cash stream and enhanced days cash on hand.
Remember, for these hospital-bled scenarios: Cash is blood.Cash is King!
We (Microscope) can provide the proper and effective preventative cash-enhancing services to resolve these often-fatal cash conundrums. Whomever you choose to fulfill your financially anemic bloodstream, please make sure your financial/operational management company offers (as Microscope does) a truly comprehensive cash-growing service withall of the following critical seven features:
1. A fullycontractually guaranteed 100% risk-freeengagement for the hospital’s enhanced cash-growing engagement.
2. Contractuallyguaranteed zero upfront fees and zero out-of-pocket fees,which means in effect that the engagement is always “free”!
3. The core consulting process ispatentedand thus governmentally established to be unique.
4. The core hospital consulting entity has more than 21 years of successfulexperience and expertise, facilitating our doing the engagement quickly and successfully while fully contractually consistent.
5. Every aspect of the engagement has been and isproven in practice.
6. Microscope does95%of the engagement work.
7. The engagementcontractually guarantees a new net cash gain of 4%of the client’s net patient revenues if the hospital completes 12 key solutions.
Understanding the cash-loss problem is step one. Recovering and keeping the dollars is step two. Let’s talk about how much your hospital could be missing and how much cash it can get back—and how to get it back—with minimum effort on the hospital’s part.
