Healthcare Economy Round of 32 Results: The Ripped Region Takes Center Court
One upset and a complaint against the Commissioners’ seeding highlighted this first round in the Healthcare Economy region. Financial trends swept the bracket in this round, confirming that solvency and budgetary challenges are likely to dominate the tournament this year.
Here’s how the four matchups in this region unfolded:
Healthcare Economy Trends
Private Equity Investment Narrowly Defeats Increase in Uninsured/Underinsured Patients
The tournament kicked off with a contest that was much closer than expected. Committee members started with a unanimous agreement in their observations that both trends are important. However, Private Equity Investment (1) ultimately took the edge in a 3-2 win, given that the effects from the Increase in U/U Patients (8) may not be fully known until perhaps 2024, but the need for and impact of Private Equity Investment is here and now.
Labor & Workforce Shortages Beats Health Equity & SDoH
Even as they recognized the continued national priority on Health Equity and SDoH (7) as healthcare drivers and the broad appreciation that zip code and genetic code are major determinants of health, they agreed in a 5-0 win that in 2023, Labor & Workforce Shortages (2) will be much more impactful.
“We’re never going to be able to solve for equity and SDoH if we don’t have the workforce ready to do their jobs.”
As one Committee Member said, “Hammers don’t build houses, people do, and we’re never going to be able to solve for equity and SDoH if we don’t have the workforce ready to do their jobs.”
“The Commissioners got the seeding wrong on this one.”
Another added, “Frankly, I think the Commissioners got the seeding wrong on this one. Health Equity and SDoH had a great regular season and should have had a higher seed. To go against last year’s champion and go down in the first round is just not a testament to the year they had.”
Reduced Discretionary Spending Upsets Digital Consolidation
In our first upset of the tournament, Committee Members stressed in a 4-1 vote the economic impact on patient behavior. Household budgets are strained, and people are putting off preventive care because of cost and Reduced Discretionary Spending (6).
“The government needs to help us out here.”
“The government needs to help us out here,” said one Committee Member. “There are still so many FTEs in regulatory roles, which creates more cost and less time for patients.”
Committee Members mostly agreed, but there was one holdout, who said that while healthcare is distracted by Reduced Discretionary Spending, there is massive Digital Consolidation (3) happening in the background.
Cost Cutting Strategies Thumps Provider Consolidation, Bankruptcies and Closures
“We have to do more with less.”
Selection Committee members were delighted with this matchup due to the well-established off-court relationship of these two trends. Committee Members agreed that in 2023, health organizations unwilling to engage in Cost Cutting Strategies (4) will surely find themselves facing Provider Consolidation, Bankruptcies and Closures (5).
While one Committee Member mentioned, “We have to do more with less,” another was more specific: “We have to focus on waste reduction.”
A third Committee Member commented, despite agreeing with other members, “But I don’t like the implications of the Cost Cutting trend, especially its impact on rural hospitals.”
Ultimately, in a 5-0 beatdown, the Committee favored Cost Cutting Strategies as what they see will be the preferred route to bankruptcy, closure or unwanted consolidation.
Which trends do you think will shape the industry in 2023?