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Expert Insight

Health systems must confront the eroding legacy hospital business model

The standard playbook for hospital profitability is no longer sufficient, as the industry faces converging challenges that threaten financial stability. From shifting volume and payer-mix, to weakening non-core revenue sources, hospitals must adapt to survive.

Hospitals and health systems face two major threats to long-term financial sustainability. First, volume and payer-mix shifts make it more difficult for providers to achieve profitability through inpatient procedure growth. Second, the supports hospitals rely on to buttress financial performance — investment income and preferable site-based payments, for example — are less stable now due to broad economic trends and the potential for significant policy changes.

 


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AFTER YOU READ THIS
  • You'll understand the greatest threats to hospitals' and health systems' long-term financial sustainability.
  • You'll recognize the long-standing trends intensifying operational challenges for hospitals and health systems.

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