Last week we met the CEO of the flagship hospital of a large academic health system. Like nearly every hospital, they are challenged in finding the staff they need to keep the hospital running at full capacity. Keeping all the hospital’s units open has been critical: “Over the past three months, we have been busting at the seams…more patients, and they’re sicker. And we’re not even really into flu season yet.” We asked what had changed, given that summer usually is lighter than other seasons for hospital admissions.
His diagnosis: local community hospitals, also strapped for staff, had begun to regularly shut down units to keep premium labor spend in check. “If they’re not running at full capacity, the patients still have to go somewhere. Given that we’re both the quaternary care provider and the community’s safety net, they’re coming downtown to us. We don’t have the luxury to shut down.” The system had to ramp up agency nursing to accommodate the demand, leading to a sharp rise in labor costs.
This CEO wasn’t backing away from the system’s mission, and vowed to expand capacity as much as they could, but felt that policymakers and payers needed to understand the dynamics in the market: “We’re getting criticized for not being able to control our costs, despite the fact that we’re absorbing what other hospitals can’t handle.” As we head into winter, flu will surely spike, and another COVID surge is possible—the hospitals at the top of the “care chain” will become even more strained in their mission to accommodate their communities’ needs.