Mastro: Existing cost structures not sustainable; more efficiency needed
By Dee Longfellow
For The Elmhurst Independent
On Tuesday, Aug. 15, Mary Lou Mastro, System CEO for Edward-Elmhurst Health, held a news conference to discuss the company’s plan to reduce costs by $50 million over the next year.
“In order for Edward-Elmhurst Health to continue to be the strong, stable organization that it is today, we must carefully manage our financial situation,” said Mastro. “Hospitals recognize that our existing cost structures are not sustainable. We must become more efficient and ensure that our expenses are well-managed.”
Reductions will include both labor and non-labor expenses and will represent approximately 4 percent of total expenses, according to Mastro.
It’s no surprise that hospitals across the country are facing many kinds financial pressure. Those that specifically challenge Edward-Elmhurst Health include:
• The number of patients in both Medicare and Medicaid has increased. These government programs do not cover the costs of patient care.
• Insured patients do not always have the resources to pay their higher co-pays and deductibles, which has contributed to increasing bad debt.
• There has been an increase in charity care.
• The number of individuals with commercial insurance has declined. Even for those who have it, commercial payments typically do not keep up with medical inflation.
• Costs of pharmaceutical and medical supplies have increased dramatically. Medical companies in the position of supplying drugs, need to make sure that they are efficient in their management and tracking (this article can explain more), so they need to work with hospitals to see if there is a way that they can reduce some costs through correlating data and taking into account what medicines are needed most, hopefully, reducing costs in some areas, however, this can be something that has a lot of layers to go through so will need careful planning.
According to a release issued following the press conference, Edward-Elmhurst Health remains firmly committed to a mission of advancing the health of its communities.
“Changes in processes will be carefully designed to improve efficiencies, maintain and enhance the quality of care provided to patients, and assure that Edward-Elmhurst Health can continue to serve patients and families in the futur,” it read.
