The
Facts
New Hampshire
Hospitals and Healthcare
SUSTAINING
NEW HAMPSHIRE'S HEALTH
ADVANTAGE
New Hampshire is an extraordinary place to live, work and raise a family.
And top-notch healthcare is a critical factor in our formula for success.
Sustaining the advantage means working to preserve regulatory and business
climates that support both the clinical and economic performance of
healthcare providers, expand access to coverage and care for everyone, and
enhance the future viability of essential community providers and services
statewide.
We're proud of the important role that community, teaching and specialty
hospitals play in New Hampshire today. They are the living legacy of a
century of caring and healing fostered by hospitals and hospital people. This
publication is dedicated to those clinicians, trustees, administrators,
volunteers and public officials working to sustain that New Hampshire
advantage for the benefit of us all.
Mike Hill, President
New Hampshire Hospital Association
2001
NEW HAMPSHIRE
IS THE HEALTHIEST STATE IN THE COUNTRY
New Hampshire ranks #1 overall in 2000. 1
New Hampshire ranks first for lowest violent crime, highest adequacy of
prenatal care, highest support for public health and lowest infant mortality.
STATES AT THE TOP OF THE RANKING
NEW HAMPSHIRE
1 MINNESOTA
2 UTAH
3 MASSACHUSETTS
4 HAWAII
5 VERMONT
6 COLORADO
7 WISCONSIN
8 CONNECTICUT
9 MAINE (TIE)
10 WASHINGTON (TIE)
1
UnitedHealth Group, State Health Ranking – 2000 Edition, November 2000.
NEW HAMPSHIRE
RANKS #1 FOR QUALITY HEALTH CARE
New Hampshire ranks #1 in the delivery of quality health care for
seniors. 2
STATES AT THE TOP OF THE RANKING
1 NEW HAMPSHIRE
2 VERMONT
3 MAINE
4 MINNESOTA
5 MASSACHUSETTS
6 CONNECTICUT
7 NORTH DAKOTA
8 IOWA
9 COLORADO
10 OREGON
2
Jencks, Stephen, Quality of Medical Care Delivered to Medicare Beneficiaries, Journal of the American
Medical Association, 2000;284:1670-1676.
NEW HAMPSHIRE
HAS A HIGH RATE
OF INSURANCE COVERAGE
The New Hampshire Department of Health and Human Services
reports that approximately 9% of New Hampshire citizens (96,000) had
no health insurance coverage in 1999. The national rate is 17%. 3
Distribution of Insurance Coverage in NH
Uninsured Insured
9% through Public
sources
7%
Insured
through Private
sources
84%
3
Health Insurance Coverage and the Uninsured in New Hampshire, Department of Health and Human
Services, November 1999.
DRUG COSTS
ARE THE MAJOR FACTOR
INFLUENCING INSURANCE PREMIUM
COST INCREASES
Several factors influence the increase in health insurance premiums. In
1999, hospital inpatient costs represented 3% of the increase for private
health insurance premiums. Twenty one percent was attributable to
hospital outpatient costs. Physician costs accounted for 32% and
prescription drug costs accounted for 44%. 4
Underlying Costs
for Insurance Premium Increases
Hospital
Hospital Inpatient
Outpatient 3%
Prescription
21% Drug
44%
Physician
32%
4
Center for Studying Health System Change, Data Bulletin, Tracking Health Care Costs: An Upswing in
Premiums and Costs Underlying Health Insurance, No. 20, November 2000.
NEW HAMPSHIRE HOSPITALS
SERVE A LARGE NUMBER OF PEOPLE
The amount of services provided by New Hampshire hospitals to New
Hampshire residents and residents of neighboring states is staggering. In
1999, New Hampshire hospitals provided: 5
500,000 emergency room visits
33,000 inpatient surgeries and 61,000 outpatient surgeries
109,000 inpatients with overnight stays
1.9 million outpatient visits
New Hampshire hospitals care for people throughout their life span. For
example, newborns account for 12% of all inpatients and the frail, elderly
population (age 80 and above) accounts for 14%. 6
Age Groups - 1999
Age 0-9
Newborns 3%
Age 80+ 12%
14% Age 10-19
3%
Age 70-79
16% Age 20-29
9%
Age 30-39
Age 60-69 Age 40-49 12%
12% Age 50-59
9%
10%
5
American Hospital Association, Hospital Statistics, 2001.
6
Foundation for Healthy Communities, Uniform Hospital Discharge Data Set, January – December 1999.
NEW HAMPSHIRE HOSPITALS ARE EFFICIENT
On a per capita basis, New Hampshire’s net revenue rate is consistently
below the per capita rates of New England and United States hospitals. In
1999, New Hampshire’s rate was $1,213, New England’s rate was $1,474
and the national rate was $1,270.7
Likewise hospital expenditure per capita rates are below New England and
United States hospitals. In 1999, New Hampshire’s rate was $1,073, the
region’s rate was $1,463, and the national rate was $1,229.
Hospital Net Revenue per Capita
$1,600
$1,400
$1,200
$1,000
$800
$600
$400
$200
$0
1995 1996 1997 1998 1999
New Hampshire New England United States
Hospital Expense per Capita
$1,600
$1,400
$1,200
$1,000
$800
$600
$400
$200
$0
1995 1996 1997 1998 1999
New Hampshire New England United States
7
American Hospital Association, Hospital Statistics, 2001.
NEW HAMPSHIRE HOSPITAL
OPERATING MARGINS ARE DECLINING
In 1995, all New Hampshire hospitals had positive operating margins. By
1999, eight out of 26 hospitals had negative margins. Statewide, the
operating margin was 2.3%, compared to 3.1% nationally. 8, 9
NH Hospital Operating Margins
5%
4%
3%
2%
1%
0%
1995 1996 1997 1998 1999
8
New Hampshire Hospital Association, 1999 hospital audited financial statements.
9
American Hospital Association, unpublished AHA Annual Survey 1998 data.
MEDICARE IS THE SINGLE LARGEST PAYOR
FOR NEW HAMPSHIRE HOSPITALS
Payor mix is one of the most important factors in determining a hospital’s
viability because each payor reimburses hospitals differently. Medicare
accounts for an average of 36% of all inpatients cared for at a New
Hampshire hospital. For individual hospitals, that percentage ranges from a
low of 19% to a high of 57%. 10
Payor Mix - 1999
Medicare/ Medicaid/
MgdCare MgdCare Self Pay
3% 1% 5%
Other Workers Comp
Comm Ins
0% 1%
13%
Blue Cross
10% Medicare
36%
Other Govt
1%
HMO Medicaid
23% 8%
10
Foundation for Healthy Communities, Uniform Hospital Discharge Data Set, January – December 1999.
THE BALANCED BUDGET ACT OF 1997
IS PROFOUNDLY AFFECTING
NEW HAMPSHIRE HOSPITALS
Nearly half of the savings relative to Medicare came from reduced Medicare
payments to hospitals. Implementation of the BBA also involves the
proliferation of regulations with which hospitals must comply.
In 1998, Medicare margins (an indicator of how well Medicare reimburses
hospitals) in New Hampshire were negative 6.5% compared to the U.S.
average of positive 2.5%. 11 In other words, Medicare paid hospitals less
than the cost of providing services to Medicare patients.
Medicare Margins - 1998
3.0% 2.5%
2.0%
1.0%
0.0%
-1.0%
-2.0%
-3.0%
-4.0%
-5.0%
-6.0%
-7.0%
-6.5%
New Hampshire United States
11
HCIA Sachs, Ernst & Young, LLP, The Financial State of Hospitals: Post-BBA and Post-BBRA, May
2000
NEW HAMPSHIRE HOSPITALS
PROVIDED $111.5 MILLION
IN UNCOMPENSATED CARE
New Hampshire hospitals provided $111.5 million in uncompensated care in
1999, up from $95 million in 1995. 12 On average, this represents 5.3% of
gross patient revenue, with individual hospital rates ranging from a low of
3.0% to a high of 10.6%. The national average is 5.9%.13
Uncompensated Care
$115,000,000
$110,000,000
$105,000,000
$100,000,000
$95,000,000
$90,000,000
$85,000,000
1995 1996 1997 1998 1999
12
New Hampshire Hospital Association, 1999 Hospital Audited Financial Statements.
13
American Hospital Association, unpublished AHA Annual Survey 1998 data.
NEW HAMPSHIRE HOSPITALS
FACE A WORKFORCE SHORTAGE
In 1996, 3.4% of the total number of RN positions in hospitals went unfilled.
As of November 1999, that figure had risen to 5.3%. LPN positions are far
worse. In 1996, the vacancy rate for LPNs was 0.5% and in November 1999,
vacancies grew to 6.7%. 14
Specialized areas, such as intensive care units and emergency departments,
are facing an even harder time recruiting qualified candidates. Many
hospitals in New Hampshire must rely on temporary nurses under contract to
fill vacant positions. This is a very costly means of providing staffing and is
expected to continue as the nursing shortage grows.
Vacancy Rates
7.00%
6.00%
5.00%
4.00%
3.00%
2.00%
1.00%
0.00%
RNs LPNs
1996 1999
14
New Hampshire Hospital Association, Health Professional Supply Report, November 1999.