The Impact Of The U.S. Recession On Hospitals

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Drivers of Decline

Commercially insured scheduled admissions are the largest contributor to inpatient margins for the average US hospital. During the US recession (2009-2011), volumes in this segment declined. There were two primary drivers of this decline.


Recession Impact

Dual Causes

First, commercial insurance coverage decreased, stemming from unemployment and underemployment. This is expected to reverse and rebound as the economy recovers and as healthcare reform is implemented.

Second, even among those who retained coverage, utilization of inpatient services decreased as patients delayed or forewent elective and preventative care. This was influenced by a range of economic factors, including reduced household incomes, higher co-pays, and a reduced ability to leave work for medical care, as well as factor unrelated to the recession, such as a shift to outpatient management of disease.

More: Are Cost Estimates Leading To The Wrong Decisions in US Hospitals?


It is unclear whether this second driver will diminish fully as the economy recovers. A slow recovery – or one that fails to see volumes to return to pre-recession levels – suggests that hospitals may need to refocus their strategies on service lines and segments that have historically been less attractive.

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Product Details

4 Responses

  1. Paying for ObamaCare

    Arizona governor plans to tax hospitals to expand Medicaid.



  2. Recession Mentality Deeply Ingrained

    The majority of consumers in the world’s richest markets have tightened their belts and are bracing for a sustained period of weak income growth.



  3. Why the Next Recession Will Be Different

    It’s the time of year when analysts and pundits begin “marking their beliefs to market” – telling us what they got right or wrong in the previous year.

    In that spirit, here are some of the things we got wrong about the Great Recession.



  4. Healthcare Cost Inflation Has Decreased After Each of the Last 3 Recessions

    Eric Bricker MD
    via Ann Miller RN MHA


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