Unplugged

CHAPTER 1:
HOSPITALS – AND THE BUSINESS OF MAKING A PROFIT

“You will observe with concern how long a useful truth may be known, and exist, before it is generally received and practiced on.”

Benjamin Franklin

A hospital is a business, whether public or private, and as a business, profit is number one. The patients, the employees and even the doctors, now take a back seat to the bottom line. The administrators of hospitals place medical care behind making money. They are experts at the game of milking the system of insurance and government payments for services and supplies provided and sometimes not even provided. The administrators no longer merely facilitate medical care; they dominate the medical care provided in hospitals.

Some hospitals proudly declare themselves to be “non-profit” (technically “not-for-profit”) institutions, clearly a misnomer, since they also exist only to allow CEOs and their cronies to enjoy outrageously high salaries and a myriad of benefits. While they legally qualify, and advertise themselves as “non-profit,” because there are no dividends as such paid to investors, the results and attendant impact upon the patients are the same as if they were being treated in for-profit hospitals, which are at least honest about their primary goal of making money for their owners/shareholders.

Health care is very big business. Facts and figures from the National Coalition on Health Care for the year 2004 are worth examining. Total health care spending was $1.9 trillion dollars, or $6,280 per person. We spend 16% of the Gross Domestic Product (GDP) on health care, and by 2015 we expect to exceed 20%. Health care spending is 4.3 times the amount spent on national defense.

At a conference with the President of the United States on November 15, 2006 the heads of three automobile corporations announced that the average cost for employees’ health care now exceeds the price of the steel used in manufacturing each vehicle.

Obviously, the amount of money available in the health care market is sure to attract the attention of the profiteers.

The Power of the Hospital Administrator

If hospitals are supposed to be about patient care, how and when did administrators become so powerful? Simply stated, a power vacuum developed. Doctors were so busy practicing medicine that administrators gradually took over control. When the doctors woke up their power was gone and the administrators were firmly in charge of everything. And with this control profits became the number one motivator for all decisions made in the hospital.

Administrators enhance and retain their power in hospitals by seizing and maintaining control of the various hospital committees, which actually run the day to day operations of the facility. Administrators ensure that their own people are on those committees. Like any other corporate entity, whether the hospital is public or private, it has directors and CEOs (under one such title or another) who are permitted to stay in power only while maximum profits are being attained.