Hospitals face insurance, staffing issues

COLDWATER - The health care industry is expected to face numerous challenges this year, including staffing shortages and grapples with insurance providers, according to a local hospital official.

During Wednesday's hospital board of governors meeting, Mercer Health Chief Financial Officer Jon Dingledine gave a forecast of the health care industry for 2023.

One of the most pressing issues facing the industry is what Dingledine called "reimbursement wars" with insurance providers.

"Our staff are going to battle every day with insurance companies who are literally changing the rules on a weekly basis in terms of what they're going to pay for," he said. "Things that were covered six months ago are now being denied, despite no evidence of abuse, despite the same trauma protocol that remained for years. For whatever reason, it's now being denied."

Dingledine said in a survey published several months ago, 70% of hospitals said relationships with commercial insurers are getting worse, 84% said the cost of complying with insurance policies is increasing and 95% reported increased staff time spent seeking prior authorization approval.

Prior authorization is a management process used by some health insurance companies to determine if they will cover a prescribed procedure, service or medication.

Prior authorization is a big issue for Mercer Health staff, Dingledine said.

"How many hours are spent by our staff trying to get things approved that again, the treatment protocols haven't changed, there's no evidence that hospitals have abused this certain code or treatment?" he asked. "But yet the first answer for a lot of these insurance companies is to deny it. Because again, it ultimately saves them money."

And while insurance companies continue to see record profits, rural health care systems are left with hardships, he said.

UnitedHealthcare, the largest health insurance company by membership in the United States, brought in over $20 billion in 2022 while 43% of rural hospitals are operating in the red, Dingledine said.

Staffing also continues to be a challenge for the health care sector.     Dingledine said 1 in 5 health care workers left the field during the COVID-19 pandemic.

Mercer Health has not been immune from staffing shortages. The health organization over the past 12 to 18 months has consistently had 40-45 job postings that have remained unfilled, he said, which represents about 5% of Mercer Health's overall staff.

"Unfortunately, a lot of that is concentrated into a couple of key areas that we've had a very, very difficult time filling. (That's) been housekeeping, that's been nursing, that's been laboratory," he said. "We've had to start looking at other options for our housekeeping department. Today, we fully outsource all of our outside facility cleaning. Before the pandemic, that was 100% done by Mercer Health staff."

Dingledine said Mercer Health has also paid approximately $1.8 million in travel nursing staff over the past 18 months due to the nursing shortage.

"Before the pandemic, I don't know that we ever used travel staff whatsoever," he said.

To help combat the staffing shortage, Dingledine said Mercer Health has started recruiting nurses and other medical staff earlier than in the past.

For example, a handful of new nurses who will start in May were recruited a year ago. Some who were recruited have made commitments to work at Mercer Health in exchange for tuition assistance, he said.

"In recruiting efforts, we have to start way earlier than what we ever have before," he said. "Almost two years ago now, we actually entered into an agreement with a provider who's not gonna be done (with school) until 2028. That was absolutely unheard of. Maybe it was a year or two out previously."

Competition also continues to be a challenge, Dingledine said.

"The recruiting of of those providers will become more and more challenging because they have more options than ever, and due to this supply and demand problem, it's extremely costly," he said.

Additionally, the health care sector has been rocked by inflation, Dingledine said. From 2021 to 2022, the industry as a whole has seen an $86 billion increase in staffing expenses, while non-staff expenses such as supplies, medication and services has increased by $49 billion.