Since the turn of the new century, additional cost-containment programs at the state and federal level have especially squeezed funding for public hospitals. Under any circumstances, these hospitals have trouble making ends meet because so many of their patients can’t afford to pay for their care. To cover that care, public hospi- tals rely on funding from state and local governments. This funding, however, has declined substantially in recent years, forcing public hospitals to cut staff, reduce services, or close altogether. The same pressures have led to the closure of 85 rural hospitals of all types between 2010 and 2018, most of which served predominantly poor populations.
Financial concerns—and desires—have also affected the mix of services of- fered by voluntary and for-profit hospitals. Rather than fighting managed care insurers over which treatments and services the insurers will cover, these hos- pitals now increasingly offer extra services that patients are willing to pay for out of pocket such as yoga, meditation, and massage. Meanwhile, the search for profits has encouraged these hospitals to offer new, technologically intensive treatments and tests even if evidence of their benefits is weak and other nearby hospitals already offer them. The result has been a proliferation of expensive technologies such as magnetic resonance imaging machines, intensive care units, and open-heart surgical suites. Conversely, many hospitals have closed, shrunk, or outsourced money-losing units such as obstetrics wards, emergency departments, and psychiatric units. Finally, an astounding number of hospitals have merged in recent years. By so doing, they have essentially created monopolies that allow them to set whatever prices they want for services because there is little or no competition At the same time, as voluntary and for-profit hospitals have shifted toward providing more intensive care for middle-class Americans, public hospitals have increasingly become primary care providers for the poor. Patients who have neither health insurance nor money to pay for care sometimes turn to hospital outpatient clinics and emergency departments not only for treatment of acute problems such as gunshot wounds but also for chronic problems such as backaches.
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