“With the election and the economy as bookends, the current state of the healthcare industry — plagued by regulatory changes, insurance quandaries, and bad debt — has become a kind of war zone,” Michael Klozotsky, analyst for Kaulkin Ginsberg, told those attending the ACA International’s annual Fall Forum in Chicago Thursday. “Indicators now suggest that the economic trends impacting the healthcare segment of the ARM industry will not be short-lived, and will continue to impact recoveries well into 2009.”
Klotzotsky pointed to the continued weak economic reports and their historical impact on health care payments. A one percent rise in the nation’s unemployment rate is projected to increase the number of uninsured by 1.1 million and result in an additional 1 million (600,000 children and 400,000 adults) enrolling in Medicaid. Unemployment has been steadily climbing in 2008, with the Labor Department Friday reporting an additional 240,000 jobs lost in October and an unemployment rate of 6.5 percent, up from 4.9 percent in January.
Bad debt expense in the for-profit hospital sector is expected to grow 15 percent to 17 percent in 2008, reaching more than $14.5 billion.
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