Editorial: Cost Pressures In Health Care; Tilting At Airplanes?
The recent announcement that Heywood Hospital in Gardner and Athol Memorial Hospital are planning to merge their administrations represents another clear indicator of the cost pressures in the health care arena — driven by market forces and government reforms — that have continued to change the industry landscape in Massachusetts.
Those pressures were evident in the hospitals' joint statement on their plans: “ … It will help Heywood and Athol Memorial to get ahead of the curve — to be prepared for the dramatic changes that are happening in health care — both in the market and as a result of state and federal government policy,” said Kenneth J. Pierce, chair of the Heywood board of trustees. Both organizations deserve credit for arriving at that realization and deciding to act.
There are many cost drivers that are forcing such marriages in the industry, from the ongoing development of new drugs to combat illnesses, to the widening use of electronic medical records, to the practice of expensive defensive medicine designed to avoid malpractice lawsuits. Those costs have been further exacerbated by longer life expectancy and the start the Baby Boom generation's march into the ranks of the retired.
By extension, those costs have been passed on to insurers and then to consumers, which has brought the big hand of government into the picture with legislative reforms at the state and federal levels.
In the latest effort at taming costs, Massachusetts recently passed a new health cost control law that — according to Moody's Investors Service — will put a serious dent in the bottom lines of many of the state's hospitals and limit their flexibility to grow.
To grow, and maybe even survive, some parts of the health care industry have little choice but to consolidate. Therefore, the Heywood-Athol affiliation is not just a sign of the times; for the two relatively small competitors (Heywood has 153 beds; Athol 25) in Northwestern Worcester County, it's a move made out of necessity.
Looking in the other direction, a trend toward more home-based care for patients who don't need acute care will lower costs for hospitals and can put downward pressure on costs. That's why UMass Memorial Health Care and Milford Regional Medical Center recently moved to unload their home health care operations to, respectively, VNA Care Network & Hospice of Worcester, and Whitinsville-based Salmon Health and Retirement, two prominent regional providers of home-based care.
This recent news of mergers and spinoffs represents a lot of change for one industry – and it has all happened just in the last few weeks. But is it all for the good? That's not an easy question to answer because while government and the industry are moving in one direction, they need business and the general public to move with them. Unlike in other industries, health care services impact everyone in a community, so the enormity of the task of driving meaningful change is all the more daunting.
Tilting At Airplanes?
You can't fault anyone for trying. And while the effort to bring JetBlue Airways to Worcester has mixed serious with whimsy through a video contest on YouTube, it nonetheless shows that there are some in Central Massachusetts who are passionate enough to halt the 5-month-long drought of commercial air passenger traffic at Worcester Regional Airport. Even Mayor Joseph Petty and City Manager Michael O'Brien got into the act with a 1-minute entry that includes a brief ride for the two officials on a baggage conveyor belt.
The task to bring a carrier to Worcester won't be easy given the issues with navigation technology at the airport and the monstrous competitive advantages of the four other airports in the region, each inside of a 90-minute drive of Central Massachusetts. But the video campaign, which also elicited a video of “mutual affection” from JetBlue, merits an “A” for effort.
Image credit: FreeDigitalPhotos.net.
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