HealthLeaders-InterStudy, a leading provider of managed care industry intelligence, finds that an earlier trend toward greater hospital profitability in the West Palm Beach area was reversed in 2004, with eight area hospitals in the red. According to the latest issue of the West Palm Beach Market Overview, Glades General Hospital was the only area facility to post a loss the previous year.
"Contributing factors to the losses were declining inpatient admissions, duplication of services, a shortage of specialists to perform high-profit procedures, and increased competition from ambulatory surgery centers not owned by hospitals," said Patrick Powers, HealthLeaders-InterStudy senior analyst. "And physician shortages may get worse, as hospital expansions create new demand for specialists already in short supply."
In recent years, the West Palm Beach hospital market has transitioned from a nonprofit arena to a for-profit one. Ten of 15 area hospitals are for- profit and the market is dominated by the nation's two major for-profit hospital companies: Tenet Healthcare and HCA. The two account for 64 percent of local annual inpatient hospital discharges at nine local hospitals.
Of particular concern is the costly expansion of open-heart surgery capabilities to two additional hospitals in 2006. Five area hospitals will soon be competing for a share of a surgical procedure market that is facing reduced local demand, thanks to the success of less invasive cardiac treatments like angioplasty.
Other news about the West Palm Beach healthcare market: * Tenet South Florida HealthSystem's long-time leader, Don Steigman, will be departing in 2006, as Tenet adopts a corporate policy of greater control over its local operations. * Steady healthcare premium increases and tight control of medical expenses helped local HMOs post earnings in 2004. * Locally, average healthcare premium increases dropped below double digits for the first time in years. About Market Overviews
Market Overviews provides a detailed analysis of local healthcare markets, allowing healthcare businesses to plan their local strategies.
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