Your Good-Paying Customers....for Now

We've talked previously about your hospital's customers here.

I think a lot about who our customers are at hospitals. Are they the patients, the doctors, or the third-party payers? It's probably a little bit of all of them. Tonight let us consider the scenario of the third-party payers as our customers.

What does this customer want? I believe the only thing that matters to this customer is what kind of return on investment are they getting from your hospital. In other words, how much cost must be incurred to provide a positive outcome for their customers, the patients. The third-party payers, along with much of the public, agree. Hospital care costs too much.

How do we know this? I think the Balanced Budget Act of 1997 is a good example of this. Would the American public approve of hospitals receiving less reimbursement for their care if they believed they were getting a good return on their investment? I don't think so.