Singing the blues in the key of "C." 0 - health care finance issues

Healthcare Financial Management, Oct, 1998 by Richard L. Clarke

Have you noticed that many of today's healthcare finance issues begin with the letter "C"? Think about it - constraints, costs, consolidation, charity care, compliance, computer crisis, Congress - these and many other concerns starting with the letter "C" can cause healthcare financial managers to want to sing the blues - in the key of "C."

Constraints on care providers, for example, can be caused by contracts that restrict their capability to change their charges for care. Contracted care often constrains the charges that care providers can consider. As a result, the capability to create capital can also be curtailed.

Constraints on charges cause concerns about the capability to cover the costs of care. Containing costs, therefore, is a key to creating constructive counters to constrained charges. These concerns, however, also compel changes in care conventions, which can curtail the consumption of care per case. This can cause a cut in cash collected by care providers and also leads to constrained capital capabilities.

Due to constrained charges and the need for cost containment, care providers and managed care companies increasingly consider consolidation of their corporations. Columbia/HCA was considered the king of consolidators until compliance concerns curtailed their course. Consolidation is considered because of the need for clout and capital. Clout is necessary for care providers to capture contracts from managed care companies. Managed care companies need clout when connecting with consumers. Both groups need clout when attempting to contain costs through coordinated resource consumption. Capital provides the cash to gain the clout necessary to contract for care. One constraint related to consolidation is the potential for the loss of control. So to gain clout and capital, care providers and managed care companies often have to consider the loss of control.

Although consolidation may help gain clout and capital, it does not necessarily help deal with charity care. In fact, the focus on constraints, costs, and consolidation often fails to consider citizens without health insurance coverage. This lack of coverage creates a concern in the community about the continuity of care, especially for children. Care providers that provide considerable charity care must conceive of constructive ways to cover the costs - a challenging conundrum.

Consternation about compliance includes concerns about civil and criminal penalties for those charged with conspiracy to cheat government care programs. Concerns about compliance almost caused the collapse of Columbia/HCA. Legal counselors and crafty cops continue to chase those considered crooked.

The end-of-the-century computer crisis is another consideration. Computers unable to convert the century change may crash, causing a need for costly corrective action. Of considerable concern is that care may be compromised by confused computers. Additionally, communication of cash transactions may also be constricted, a condition caused by computers unable to calculate the correct calendar date.

Finally, Congress continues to create a crazy quilt of conflicting codes. Care providers and managed care companies will be clobbered by cost control efforts, especially those contained in the Balanced Budget Act, which continue to constrain cash from programs controlled by Congress. Congress appears to be content to control costs instead to dealing with comprehensive changes to coverage and care concerns.

Coping with the challenges of constraints, costs, consolidations, charity care, compliance, computers, and Congress could be considered a curse. However, conquering these challenges can create career contentment for those who are conscientious.