A laurel to the Colorado Springs Gazette for its story on problems at Memorial Health system, a city-owned health care provider that has fallen on hard financial times. Gazettereporters uncovered a memo from hospital administrators that laid out the hospital’s grim financial outlook. The memo, which talked of layoffs, told the system’s 4,000 employees that the money situation will worsen, but that they should “not become paralyzed in the fog of fear.” The story touched on a theme that deserves further investigation by that paper and others. Municipal hospitals all over the country are having trouble, and the current economic crisis makes the situation worse.
As the cost of care increases and insurers pass on those costs to patients, patients begin to use fewer services, particularly elective procedures. They delay hip and knee replacements—and that’s bad news for hospital budgets. Some experts believe in making patients responsible for cost containment by forcing them to use the system less. But when they do that, as we see in Colorado and other places, some hospitals suffer, particularly the ones that serve poor people in inner city neighborhoods. We hope that the Gazette will stay with the story, and that other papers will explore this topic and look at how reform will change the financial picture for these hospitals, if at all.