The MHA exists to advance the health of individuals and communities, and we support our member hospitals every day with that end in mind. If there is one resounding concern we've heard from hospitals this year, it's that the financial vice they are caught in — sandwiched between skyrocketing costs, and stagnant and inadequate reimbursement — is pushing them to a breaking point.

Michigan communities are at risk of losing access to quality care if we don't address the funding crisis that our hospitals face.

A Sept. 2 Modern Healthcare article detailed the struggles of hospitals nationwide:

• Dwindling labor and delivery nursing staffs, lost in part to traveler agencies padding their record profits off the backs of caregivers and patients.

• Access to mental health beds is even worse than usual because of staffing challenges and lack of emergency relief funds.

In Michigan, you can find these same circumstances: We've lost roughly 1,700 staffed hospital beds since 2020.

The American Hospital Association (AHA) recently hosted a national call to sound the alarm about the financial strain on hospitals and risks to patient access that are imminent if policymakers don't act. Michigan-headquartered (and MHA member) Trinity Health spoke during that call, outlining the severity of the financial strain on their system and how it is affecting their ability to provide the right care to the right people, at the right time — right here in Michigan.

Multiple factors have contributed to the drain on hospital resources: fewer workers, increasingly sicker patients, and higher costs that cannot keep up with inflation. According to a new AHA 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.

All these factors have led to devastating pressure on the hospitals we rely on for trauma care, cancer treatment, preventive services, health education and more. And unlike many service providers, hospitals don't get to simply increase what they receive in payment.

Some short-term solutions — such as the $225 million appropriated by Michigan lawmakers for health care retention, recruitment and training — provided temporary relief but won't fix long-term problems. Unfortunately, that funding was a drop in the bucket for health care's financial challenges. A segment of MHA members reported in a recent survey spending $1.1 billion more on labor expenses in 2022 than 2020.

We know it's not all about funding. It's also about patient care and rebuilding the talent pipeline. To that end, the MHA is supporting efforts like ensuring licensed providers can practice to the full extent of their license and training, expanding nursing degree programs at community colleges, forming partnerships with workforce development agencies to improve talent pipeline management and more. We're also working to ensure all workers feel safe and supported despite rising cases of violence against our employees.

We must have all hands on deck. The U.S. is facing a major health care worker shortage. With Medicare beneficiaries in Michigan increasing over the past five years to a total of 2.1 million people, Michigan needs more health care workers to serve the state's aging population.

Bottom line: Michiganders deserve high-quality, accessible, affordable health care services, and without financial resources to adequately provide that care, Michigan hospital services will be lost. As goes the local hospital, so goes the local economy. Health care is the largest private-sector employer in Michigan, and healthy communities — and financially healthy hospitals — are directly tied to a strong economy. Young people and families won't establish roots in a community that doesn't have good health care. Businesses want their employees to get quality care locally so they can get back to work.

Michigan hospitals are not giving up on the fight to provide the care their communities need. But they need the support of policymakers now more than ever. We are emerging from the dark depths of a global pandemic, finding our way through economic and inflationary pressures impacted by not only national but international issues, and seeing our population age and get sicker. The way we've always financially supported health care institutions isn't good enough anymore. We urge lawmakers in Lansing and Washington, DC, to join us in supporting smart, evidence-based investments in health care that will ensure communities keep access to high-quality care, and the economies those institutions support can continue to thrive.

Brian Peters is chief executive officer of the Michigan Health & Hospital Association

Staying current is easy with Crain's news delivered straight to your inbox, free of charge. Click below to see everything we have to offer.

With a Crain’s Detroit Subscription you get exclusive access, insights and experiences to help you succeed in business.

Helping you succeed in business since 1985.

1155 Gratiot Avenue Detroit MI  48207-2997