Distressed
Health Care
Political decisions expose hospitals to severe economic pressure. Commencing with the switch of the reimbursement scheme for in-patient services to the DRG system after the year 2001, rules and stipulations have constantly become stricter. Tougher requirements of resource deployment have coupled with reimbursements not necessarily covering those cost to the full extent. The recently imposed additional burdens from the Personnel Limits Act as well as from the new German Medical Service of the Health Funds (MDK) bill lead to a heavy increase of economic problems.
Insufficient strategic positioning and multiple inefficiencies in daily operations regularly lead to a downturn into the loss area. This creates tremendous challenges to the responsible leadership as well as the owners – severe decisions have to be taken, even until hospital closure.
In order to prevent this, tangible actions are to be taken – now.
It is easy to recognize that, for many hospitals, and hence for their owners, the sheer continuation of current practice, i. e. marginal optimisation is not adequate and sufficient any more: Rather, restructuring pathways to be consequently implemented have to be developed and pursued.
Restructuring instruments foreseen by policy makers will grant short-term improvements.
By utilising those, business models can be rebuilt more substantially, liquidity crises overcome and debts restructured. Depending on the individual situation, the respective instruments are applied in a targeted and effective manner. Following restructuring scenarios are available:
