Solucient: U.S. Hospital Investment in Capital Projects Declines in 2003; New Solucient Findings Suggest Hospitals Facing Difficulties Funding Capital Improvement Needs 4/27/2004
From: Tarsis Lopez of Solucient, 847-440-9619 or tlopez@solucient.com EVANSTON, Ill., April 27 -- The portion of operating expenses earmarked for capital improvement at U.S. hospitals fell by 17 percent over the past six years, according to new Solucient(r) research released today. Specifically, Solucient found that the percentage of operating expenses allocated to capital improvement dipped to 7.5 percent in 2003 from a high of 9 percent in 1997. "Our findings suggest reduced margins in U.S. hospitals are making it difficult for facilities to fund key investments in plant, equipment, and technology," said Kaveh Safavi, chief medical officer at Solucient. Solucient provides comprehensive health care information to drive business growth, manage costs, and help deliver quality care for providers, payers, employers, and pharmaceutical and medical device companies. For hospitals in every U.S. region in 2003, except for the South Central United States, capital cost budgets were lower than in 2002. On average, capital costs were highest for hospitals in the North Central region of the United States, and lowest in the West. However, hospitals in the South Central region - which includes states such as Texas, Mississippi, and Kentucky - experienced an increase of 14 percent over 2002 levels. According to Safavi, this increase in the South Central region could be a sign of things to come for hospitals nationwide. "Recent surveys have concluded that many hospitals have started or plan to significantly increase their investment in capital projects over the next several years," said Safavi. "However, given the current limited revenue sources for hospitals, this will still be a significant challenge for many healthcare providers." Solucient's findings are derived from ACTION O-I(tm), a comparative program that allows hospitals and health systems to evaluate operational and financial performance across the industry, at the system, hospital, and department level, to help them: -- Accurately identify high cost opportunities for performance improvement -- Target high-growth opportunities -- Achieve quantifiable ROI in performance improvement initiatives -- Execute in-depth analyses to support budget projections and staffing requirements -- Merge quantitative and qualitative information for comparative benchmarking This month, new features were added to ACTION O-I to include a broader comparative hospital database for quarterly and annual subscribers and provide enhanced opportunity assessment reports for performance improvement. For more information on Solucient tools and services, log on to http://www.solucient.com. ------ About Solucient Solucient is the leading source of health care business intelligence. The company provides comprehensive, results-oriented information to drive business growth, manage costs, and help deliver quality care. Solucient's expertise and proven solutions enable providers, payers, employers, and pharmaceutical companies to achieve results and realize value. For more information, visit http://www.solucient.com |