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Troubled Economy Impacts Providers of Specialized Health Care Services for Children

ALEXANDRIA, Va., Feb. 26 /PRNewswire-USNewswire/ -- To gauge the impact of the worsening U.S. economy on children's hospitals, the National Association of Children's Hospitals and Related Institutions fielded a survey to its members in January that found children's hospitals, like their adult counterparts, are feeling the impact.

Relative to their projected levels,

  • 44 percent of children's hospitals have seen an increase in emergency visits
  • 55 percent have seen a decrease in inpatient admissions;
  • 43 percent have seen a moderate to significant decrease in charitable contributions/philanthropy; and
  • 57 percent have seen some type of increase in Medicaid and SCHIP as percentage of total revenue.

"Children's hospitals provide the majority of hospital care to low income children dependent on Medicaid," said Lawrence McAndrews, president and CEO of NACHRI. "We anticipate that the recently enacted stimulus package will aid states in shoring up their Medicaid programs which in turn will help safety net providers, including children's hospitals, continue their level of care to child patients, provided state legislatures not cut their Medicaid budgets or decrease Medicaid provider payments. On average, children's hospitals devote nearly half their patient care to children dependent on Medicaid."

More than half of children's hospitals in the U.S. are located in the 20 states that are in the most financial distress (as reported by Kaiser State Health Facts; the State Fiscal Distress ranking is based on three indicators, including foreclosure rates, changes in unemployment rates, and changes in food stamp participation rates.)

In addition, more than 50 percent of children's hospitals report making or considering the following changes in response to the economic downturn:

  • Cutting administrative costs
  • Freezing or reducing non-clinical staff
  • Freezing or reducing clinical staff

Children's hospitals are also reconsidering or postponing capital expenditures in:

  • New capacity/renovations
  • Clinical technology/equipment
  • Information technology

"We remain optimistic that the stimulus and reauthorization of the State Children's Health Insurance Program (SCHIP) will enable states to maintain or even expand health care services to children," said McAndrews. "Children's hospitals will do everything in their power to sustain and deliver critical health care services to children in need."

About the survey - The NACHRI Economic Crisis Impact survey was sent to 197 children's hospitals in January 2009. Forty-two children's hospitals responded to the survey for a response rate of 21 percent.

Founded in 1968, NACHRI is an association of more than 200 children's hospitals and related institutions devoted to improving the health and well-being of children and families through support of children's hospitals' four-fold mission of clinical care, pediatric training, research and child advocacy.

SOURCE National Association of Children's Hospitals and Related Institutions
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