About HOSPITAL SOLUTIONS

• A popular belief is that not-for-profit hospitals are not businesses, and therefore, need not comply with business principles. Although, hospitals are unique businesses, they are nevertheless, businesses.
• Every organization, regardless of its mission or purpose must be financially successful and solvent. Hospitals that ignore underlying market economics and use of fundamental management principles will fail.

• Declining reimbursement has been called the major threat to hospitals and is blamed as the cause of declining profitability and financial failure. Declining reimbursement is a contributing factor, and lack of profit is a symptom. However, the fundamental causes of financial failure are ineffective leadership, failure to see the hospital as a business, and misuse or absence of contemporary management principles and methods.

• Ironically, some hospitals, large and small, are profitable. Others are not. And all hospitals operate in markets that are subject to the same reimbursement, regulation, and litigation conditions. Therefore, these “threats” cannot explain failure.