Rising costs, uncertain governmental policies, workforce challenges, behavioral health and equity issues have put hospitals and health systems in a compromising position. The summit aimed to connect industry experts to collaborate on solutions and share best practices to tackle these issues.
Laura Appel, executive vice president of government relations and public policy at the MHA, spoke on a panel that covered solutions to the labor challenges and measures that reduce pressure on healthcare institutions throughout the state.
“There are no quick, easy fixes,” Appel noted. “Public health is a way for us to get people in a better place in the aggregate – we cannot solve diabetes, for example, with healthcare alone. We’ve got to do the policy work that it takes to push back and reduce rates [of illness], as opposed to just stopping the upward trends.”
Leaders from MHA-member hospitals and health systems were also featured in breakout sessions that covered workforce challenges and technological solutions to improve efficiency and safety. Panelists included:
Kimberly Keaton Williams, vice president of talent acquisition and development and chief diversity officer at McLaren Health Care.
Shana Lewis, vice president of talent acquisition and workforce development programs at Trinity Health.
Lisa Ouellette, interim chief human resources officer at Corewell Health.
Robert Riney, president & CEO of Henry Ford Health.
The event also featured keynote speaker Dr. Joneigh Khaldun, vice president and chief health equity officer at CVS Health, who spoke about attainable solutions for addressing inequities and improving health outcomes for underserved, vulnerable communities.
The Michigan Department of Insurance and Financial Services (DIFS) issued Bulletin 2022-17-INS Oct. 5 in the matter of payment and billing guidance for no-fault automobile insurers and healthcare providers following an order from the Michigan Supreme Court in the Andary v. USAA lawsuit …
The Michigan Department of Health and Human Services (MDHHS) released a proposed policy to rescind remaining waived provider enrollment (PE) requirements implemented by MSA 20-28 and resume required enrollment activities that were waived during the federal COVID-19 Public Health Emergency (PHE) …
The Centers for Medicare & Medicaid Services (CMS) recently announced the calendar year 2023 Medicare fee-for-service Part A deductible for inpatient hospital services will increase by $44 to a new total of $1,600 …
Food insecurity and health outcomes go hand in hand, as those who struggle to put food on the table are at a higher risk of conditions like diabetes, hypertension and heart disease. In 2020, more than one million Michiganders faced food insecurity – including 300,000 children …
The American Academy of Pediatrics (AAP) recently announced multiple grant opportunities for health organizations and AAP Chapters to improve community confidence in vaccines and to support pediatricians in the delivery of on-time vaccinations …
Healthcare workforce shortages, particularly nursing shortages, are severely hindering the ability to provide patient-centered care. Unionizing to negotiate for policies like staffing ratios is popular but does not consider the complexity of significant workforce shortages …
The MHA’s Race of the Week series highlights the most pivotal statewide races and ballot questions for Election 2022. The series will provide hospitals and healthcare advocates with the resources they need to make informed decisions on Election Day, including candidates’ views and background …
“Last Wednesday, the White House hosted the White House Conference on Hunger, Nutrition, and Health in DC—the first since the Nixon administration’s conference in 1969. Noting that food insecurity is an issue in one in four US households and the eroding nutritional value of the food supply chain, the Administration laid out its strategy in a 44-page document featuring 5 pillars of its attention…
The White House Strategy is a great start but the issues of food insecurity and nutritional deficiency require urgent, comprehensive and dedicated attention. The White House says it has secured pledges of $8 billion from the private sector to advance the strategy: that’s a good start, but only a fraction of what’s needed.”
Bridge Michigan published an article Oct. 4 which focuses on the staffing challenges impacting behavioral health providers that limit bed capacity. The article begins by reviewing the number of reduced beds at state psychiatric facilities …
Crain’s Detroit Business published an op-ed from MHA CEO Brian Peters Sept. 22 on the unsustainable financial strain currently being experienced by Michigan hospitals and health systems. The op-ed was in response to a Sept. 2 Modern Healthcare article detailing the struggles of hospitals nationwide.
Peters describes the untenable situation where hospitals are experiencing skyrocketing costs combined with stagnant and inadequate reimbursement and staffing challenges. Statewide, Michigan has lost approximately 1,700 staffed hospital beds since 2020 due to lack of available staff. Peters also mentioned the many actions the MHA and member hospitals are taking to address these challenges.
“Multiple factors have contributed to the drain on hospital resources: fewer workers, increasingly sicker patients, and higher costs that cannot keep up with inflation,” said Peters. “According to a new American Hospital Association report, the average length of a hospital stay rose almost 10 percent from 2019 to 2021. Compensation for direct jobs in nursing and residential care rose by about $200 million from 2019 to 2020, but the number of jobs fell by about 11,000. Hospital labor expenses per patient also increased 19 percent. Health care reimbursement is unable to quickly respond to inflation since rates are negotiated in advance, presenting additional financial challenges.
Provides Nearly 572,000 Direct Jobs, 224,000 in Hospitals Alone
The Partnership for Michigan’s Health reports healthcare directly employed nearly 572,000 Michigan residents in 2020, demonstrating that healthcare continues to be the largest private-sector employer in the state despite staffing losses attributed to the COVID-19 pandemic. The 2022 release of The Economic Impact of Healthcare in Michigan shows direct healthcare workers in Michigan earned $44.2 billion that year in wages, salaries and benefits. Hospitals alone employed 224,000 individuals in the state in 2020.
Direct healthcare employment helps create additional jobs that are indirectly related to or induced by healthcare. These indirect, healthcare-supported jobs are held by more than 502,000 people who earned about $28 billion in 2020 in wages, salaries and benefits. Together with their employers, the nearly 1.1 million workers in the healthcare sector contributed almost $15.2 billion that year in local, state and federal taxes. These taxes include Social Security, income, motor vehicle, sales, property, corporate and more.
Data from 2020 shows the early impact the pandemic had on the economic strength of the healthcare sector in Michigan. In particular, the data illustrates the rise in labor costs as many nurses transitioned to contract labor with staffing agencies. Compensation for direct jobs in Nursing and Residential Care rose by about $200 million from 2019 to 2020, although the number of jobs fell by about 11,000. Specific to hospitals, the number of jobs fell by about 7,000 jobs from 2019 to 2020, but total compensation remained about the same.
The loss in jobs represents the initial exit of many healthcare workers due to burnout and stress associated with the pandemic. Both nationally and in Michigan, healthcare experienced a shortage of healthcare employees for several years and the pandemic caused a sudden loss of existing workers. With Medicare beneficiaries in Michigan increasing by more than 8% over the past five years to a total of 2.1 million people, Michigan needs more healthcare workers, now more than ever, to serve the changing needs of the state’s aging population.
The trend of nurses transitioning to contract labor is supported by recent research from the American Hospital Association, which found labor expenses per patient for hospitals increased 19% through 2021 compared to 2019. Increased labor expenses have a more profound impact on hospitals and health systems, as labor expenses account for more than 50% of total expenses for most hospitals. In addition, healthcare reimbursement is unable to quickly respond to inflationary pressures since rates are negotiated months in advance, presenting additional financial challenges when responding to sudden labor market demand.
The report was compiled by the Partnership for Michigan’s Health, which consists of the Michigan Health & Hospital Association, the Michigan State Medical Society and the Michigan Osteopathic Association, all based in the greater Lansing area. It uses 2019 and 2020 data, which is the most recent available.
“This report demonstrates the unquestionable and significant role healthcare, and specifically hospitals, play in Michigan communities,” said Michigan Health & Hospital Association CEO Brian Peters. “Not only have they played a vital role in the care and treatment of patients, but they remain far and away the leading employers and large drivers of economic activity.”
“Healthcare careers are not only extremely rewarding, but crucial to our society,” said Kris Nicholoff, executive director of the Michigan Osteopathic Association. “While healthcare careers remain in high demand, the data shows there are over a million individuals we owe our gratitude toward for providing care during one of the most trying and tumultuous years in modern history.”
“Physicians are and will continue to remain a key driver of healthcare employment and economic growth,” said Julie L. Novak, CEO of the Michigan State Medical Society. “Investing in physician-led team-based care and healthcare careers is key to the economic vitality and health of our state, local communities and residents. Physician practices, hospitals and other care settings offer good paying and stable jobs in careers that truly improve and save lives.”
Hospitals and healthcare providers remain focused on ensuring these jobs meet the needs of their employees, from offering competitive compensation and benefits to ensuring a safe and supportive work environment. The Partnership for Michigan’s Health joined several other organizations in the Healthcare Workforce Sustainability Alliance to advocate for state funding to support the recruitment, retention and training of healthcare workers. These efforts were successful in Public Act 9 of 2022 which allocates $300 million in state funding to support Michigan’s healthcare workforce.
The 16th and 17th editions of The Economic Impact of Healthcare in Michigan were compiled using IMPLAN® cloud software to quantify healthcare’s significant economic impact in the state. The data represents direct, indirect and induced healthcare jobs; taxes paid by those workers and their employers; and salaries, wages and benefits earned. The report is an online, interactive tool that allows users to examine these economic impacts from a statewide perspective and by region, county or congressional district. The data from both 2019 and 2020 is provided in two separate data tables. It is available at www.economicimpact.org.
The MHA responded to several media requests the weeks of Aug. 15 and Aug. 22 which focused on different aspects of healthcare workforce sustainability, ranging from emergency department wait times to efforts to address the talent pipeline.
Below is a collection of headlines from around the state that include interviews or statements from MHA representatives.
The MHA received media coverage on a variety of topics during the weeks of Aug. 1 and Aug. 8. Areas of focus included health insurance tax credits from the American Rescue Plan Act (ARPA), healthcare benefits in the Inflation Reduction Act, growing demand for healthcare careers and more.
Crain’s Detroit Business published Aug. 2 a Letter to the Editor on the importance of permanently writing into law ARPA health insurance tax credits that was signed by Laura Appel, executive vice president of government relations and public policy, MHA, along with Dominick Pallone, executive director, Michigan Association of Health Plans; Julie Novak, CEO, Michigan State Medical Society; and Phillip Bergquist, CEO, Michigan Primary Care Association. Together, they describe how the expanded income tax credits helped 67,000 Michigan residents gain access to health insurance.
“Premium tax credits serve as a key that unlocks greater access to this care and the healthier future we need. We must protect them before it’s too late. We call on lawmakers to work with urgency to see that ARPA’s health insurance tax credits are permanently written into law before they expire at the end of this year.”
An article on the fastest growing job opportunities in Michigan through 2030 was also published by Crain’s, which includes several healthcare careers at the top of the list. The article quotes Brian Peters discussing the state funding available for community colleges to partner with a four-year institution to offer a bachelor’s degree in nursing on a community college campus.
“Staffing shortages are impacting Michigan hospitals throughout the state, particularly in the areas of nursing,” said Peters. “This plan will help us get more highly-skilled professionals into the field quickly and increase access to nursing education in more communities across the state.”
Lastly, Crain’s published a story Aug. 12 that includes a quote from the MHA celebrating the federal Inflation Reduction Act including an extension for three years of expanded subsidies to reduce Health Insurance Marketplace premiums and insulin being capped at $35 a month for Medicare patients.
Additional news clips included a statement provided to MiBiz on a Michigan Court of Appeals ruling Aug. 1 that allowed county prosecutors to pursue criminal charges in most abortion cases until an Oakland County circuit court judge granted a temporary restraining order to block local prosecutors from enforcing the law later that same day. Becker’s Hospital Review also published an interview with MHA CEO Brian Peters on a variety of topics in preparation for Peters serving on a panel at Becker’s 10th Annual CEO + CFO Roundtable conference in November.
By Dan McPhee, partnership relationship manager at Salary.com, an MHA Endorsed Business Partner.
It’s well known within the healthcare industry that issues of employee turnover, lack of applicants and salary compression were exacerbated in 2020 and 2021. Unfortunately, these trends have continued throughout 2022 with indications that 2023 will be just as challenging. While there are several drivers of long-term employee retention, compensation professionals within the industry note three common challenges when it comes to employee turnover and recruitment:
Employees leaving healthcare entirely for higher pay and/or better schedules.
Employees transitioning from one healthcare facility to another for higher pay, benefits and/or better schedules.
Employees moving out of city or state for higher pay, sometimes responding to economic relocation incentives provided by a hospital system, state or city.
These are informative themes, but each would warrant a case study for detailed, long-term solutions. MHA Endorsed Business Partner (EBP) Salary.com has the data to look at solutions to these challenges within their CompAnalyst MarketData tool. With more than 8,000 benchmark jobs updated monthly and the ability to scope by industry, geography and facility size, the team can easily pull valuable data into reports to help HR and compensation professionals better understand the market, competition and industry pay.
MHA members are invited to try until Sept. 15 a free trial of the CompAnalyst MarketData tool for 30 days or 15 job pricings (whichever comes first) and receive full support from Salary.com on using the tool and identifying solutions to these challenges. Members also receive discounts on all Salary.com subscriptions and resources.
“We must find time to stop and thank the people who make a difference in our lives.” ― John F. Kennedy
We have rightfully spent a lot of time in the past two years thanking the heroes who work in our hospitals and other healthcare settings for the incredible work they have done in the face of extreme challenge.
I want to take a moment now to thank another group of people who have recently helped our cause through their bipartisan actions; our elected officials in Lansing were extremely busy the last week of June passing the fiscal year 2023 state budget, which has since been signed by Gov. Whitmer. Our MHA mission is to advance the health of individuals and communities — and this budget absolutely provides significant help in that regard. While some elements of the new budget represent long-standing MHA priorities, others are new funding items that have the potential to reshape access to care and help our members and the patients and communities they serve.
Our MHA team does a tremendous job advocating for the importance of items such as the Healthy Michigan Plan, graduate medical education of physician residents, disproportionate share hospital funding, maximization of our robust provider tax program and Medicaid payment rates, the rural access pool and obstetrical stabilization fund, and critical access hospital reimbursement rates. Every election cycle, new legislators are welcomed to Lansing and the MHA’s efforts never stop to ensure these decisionmakers are aware of the impact these budget items play in their communities. The bottom line is the financial viability of hospitals is increasingly reliant on these important programs, and the MHA is dedicated to protecting them.
Hospital closures continue to happen across the country. However, they have occurred at a much higher rate in states that have not participated in Medicaid expansion through the Affordable Care Act. Maintaining funding for our expansion program — the Healthy Michigan Plan — has been one of our top priorities, and the pandemic has made the importance of insurance coverage more important than ever. In short, when the pandemic hit and thousands of Michiganders lost their jobs, the Healthy Michigan Plan was there to ensure access to good healthcare.
Our hospitals that treat the highest numbers of uninsured and underinsured patients also qualify for disproportionate share hospital funding, which provides enhanced reimbursement to account for the higher costs of care. This pool is funded through hospital provider taxes that reduce the state’s general fund contribution to the overall Medicaid program.
Small, rural and independent hospitals can often experience financial challenges in a particularly acute way, thus items such as the rural access pool, obstetrical stabilization fund and critical access hospital reimbursement rates also support access to healthcare services in rural areas. Labor and delivery units typically do not contribute to positive margins, but they are extremely important for families and communities. The obstetrical stabilization fund provides additional means for hospitals in rural areas to maintain these services so expectant mothers can avoid driving exorbitant distances for these services. Lastly, the state also included $56 million in new funding to increase Medicaid reimbursement rates for primary care services, which will help individuals on Medicaid receive the necessary primary and preventative care that can help prevent hospitalizations and reduce overall healthcare costs.
Lastly, behavioral health investments have been at the forefront of our advocacy efforts for some time and we were very pleased to see new funding to improve and enhance state behavioral health facility capacity. Michigan lacks adequate capacity to treat patients with behavioral and mental illness and this new funding is an important and necessary step to address the shortage. Included is $50 million to expand pediatric inpatient behavioral health capacity, $30 million to establish crisis stabilization units and $10 million to fund the essential health provider loan repayment program to cover behavioral health professionals.
In total, the budget includes $625 million in new investments for behavioral health funding and investments in workforce. While this will not solve all the issues impacting hospitals, it provides needed resources and demonstrates the commitment of lawmakers to a healthy Michigan. This budget also signifies that our work must continue to advocate for the resources necessary for hospitals and health systems to care for all Michiganders. Once again, on behalf of the entire MHA family, I want to acknowledge and thank both Governor Whitmer, as well as lawmakers in the state House and Senate, for their support of this latest state budget. And I would also encourage anyone who cares about access to quality, affordable healthcare to engage in the process, share your stories and input with those who can make a difference going forward. But also remember to say thank you when they support our cause.
The MHA received media coverage on a variety of topics during the weeks of June 27 and July 4. Areas of focus included the Supreme Court of the United States (SCOTUS) decision in Dobbs v. Jackson Women’s Health, the passage of the fiscal year 2023 state budget and challenges facing small and rural hospitals.
The MHA shared a statement with media following the SCOTUS decision that repealed Roe v. Wade. Outlets that included comment from the MHA in their stories included the Detroit Free Press, Bridge and Gongwer.
The passage of the state budget the morning of July 1 by the Michigan Legislature was celebrated by MHA CEO Brian Peters in a media statement that outlined the existing MHA budget priorities that continue to be protected as well as significant new funding to support behavioral health capacity and the healthcare workforce. MLive, MiBiz, The Center Square and Gongwer carried portions of the statement.
Renewed attention was brought to financial challenges faced by small and rural, particularly independent, hospitals due to a legislative request for funding from Sturgis Hospital as the organization pursues the possibility of converting to the new rural emergency hospital designation through the Centers for Medicaid and Medicare Services. MiBiz and Bridge published articles that include reaction from the MHA following assistance the association made in the legislative ask that secured $11 million for Sturgis Hospital.
Members with any questions regarding media requests should be directed to John Karasinski at the MHA.
The following statement can be attributed to Brian Peters, CEO of the Michigan Health & Hospital Association. *The budget has since been signed by Gov. Whitmer on July 20, 2022.
The fiscal year 2023 state budget approved by the Michigan Legislature provides necessary resources to assist hospitals and health systems in advancing the health of individuals and communities throughout our state. We appreciate the work and consideration placed by lawmakers that continues to protect hospital priorities.
These priorities include maintaining funding for the Healthy Michigan Plan, graduate medical education of physician residents, disproportionate share hospitals which treat the highest numbers of uninsured and underinsured patients, the rural access pool and obstetrical stabilization fund, and critical access hospital reimbursement rates which all support access to healthcare services in rural areas. Each of these areas are instrumental to keeping hospitals financially secure, particularly in areas serving vulnerable and underserved populations.
We are also extremely happy to see new funding to improve and enhance state behavioral health facility capacity and to address the healthcare workforce. Michigan lacks adequate capacity to treat patients with behavioral and mental illness and this new funding is an important and necessary step to address the shortage. The investment of state funds to expand access to bachelor of science in nursing degree programs at the state’s community colleges is a significant movement towards replenishing Michigan’s healthcare talent pipeline.
We look forward to a signed budget that provides the resources necessary for hospitals and health systems to care for all Michiganders.