Recession puts the squeeze on hospital IT projects

By Bernie Monegain
11:00 AM
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The recession has forced more than half the nation's hospitals to either scale back information technology projects already in progress or postpone them, according to a new survey from the American Hospital Association.

The findings are based on 1,078 responses that the AHA calls "broadly representative of the universe of hospitals."

The survey shows that 28 percent scaled back IT projects already in progress, while 27 percent decided not to move forward on planned projects. Six percent halted IT projects that were already under way.

Hospitals also reported scaling back or eliminating clinical technology plans, with 34 percent deciding to not move forward on their plans and 32 percent scaling back. Six percent stopped clinical technology projects already in the works.

Hospitals are finding themselves financially squeezed in other ways, too.

The survey shows that six out of 10 hospitals nationally are seeing a greater proportion of patients without insurance coming through their emergency departments. At the same time, nearly half of the hospitals reported they have cut staff.

Recent employment information from the Bureau of Labor Statistics confirms that hospital employment is no longer growing and that the number of mass layoffs for hospitals reported in February was more than double what it was a year ago.

A majority of hospitals reported that fewer patients are seeking inpatient and elective services. However, many hospitals are seeing more patients covered by Medicaid and other public programs for those in need. Need for hospital-subsidized services such as clinics, screenings and outreach is increasing even as charitable contributions are down.

"Today's findings signal what many of us in healthcare are concerned about: People put off care when they lose their job, which can complicate healthcare issues for many down the road," said AHA President and CEO Rich Umbdenstock. "At the same time, the fact that hospitals are cutting staff challenges the notion that hospitals are recession-proof."

The survey found that nine in 10 hospitals are making cutbacks to help weather the economic storm. At the same time, more than one in five hospitals reported reducing services their community depends on, such as behavioral health programs, post acute care, clinics and patient education.

"Community need for care remains high, and in these tough times communities turn to their local hospital," Umbdenstock said. "Hospitals are walking a tightrope, trying to balance the growing needs of their communities with today's economic challenges."

The survey, the AHA's second about the economic downturn's impact on patients and community hospitals, was sent to all 4,946 community hospitals in March.