The hospital sector in southern New Jersey is faring better than health systems in other parts of the state, where eight hospitals have closed this year, according to HealthLeaders-InterStudy, a Nashville, Tenn.-based health care business information company.

The southern New Jersey hospital sector has remained relatively strong, largely because South Jersey did not have the same oversaturation of medical services that exists in northern New Jersey, according to the HealthLeaders market overview.

“There was a lot of redundancy happening in northern New Jersey, and they have shut down several hospitals there over the last couple of years,” Chris Clancy, market analyst with HealthLeaders-InterStudy, told NJBIZ. By contrast, hospitals in southern New Jersey have not been closing, but are in fact expanding, he said. Five of South Jersey’s six health systems currently have major construction projects under way, according to Clancy.

Also, hospitals in the southern New Jersey market, such as Camden’s Cooper University Hospital, receive a higher reimbursement rate than other hospitals for Medicaid patients, according to the report. The higher Medicaid reimbursements allow the hospitals to make more money, Clancy said.

But South Jersey isn’t immune from current economic conditions, he said. “Recent profit margins may decrease in light of the nation’s economic downturn and recent budget cuts in New Jersey,” he said.

Return to In the News

www.njbiz.com