No industry likely feels the effects of changing technology, demographics and economics as much as the health care sector. Providing quality care, often with shrinking financial resources, to a growing ”“ and graying ”“ population, as well as an increasing number of uninsured, is a tall order indeed.
How are hospitals coping in these tough economic times?
The Business Journal checked in with Keith Safian, president and CEO of Phelps Memorial Hospital Center in Sleepy Hollow.
Safian, who is marking a milestone ”“ his 20th year as chief at Phelps ”“ has seen many changes in the field, and in the region.
In an “Online” interview, Safian talked about the health care industry and some of the major advances, expansions and affiliations at Phelps. Under his leadership, Phelps has grown as a health care provider and economic force in Westchester, operating in the black in all but one of the last 20 years. Since Safian came on board in 1989, the hospital”™s operating budget has increased from $40 million to $188 million.
Following are edited excerpts. For the entire interview, go to our web site westfaironline.com.
Caryn McBride:
Phelps is profitable and that”™s notable, especially in this economy. It has been in the black for 19 of the past 20 years?
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Keith Safian:
“Yes, that is the case. Phelps has been able to at least generate a surplus each year which enables us to reinvest money the following year in buying new technology or upgrading the facilities and expanding programs. We just finished our largest capital campaign last year where we raised $20 million, which was four times what we ever raised before, which permitted us to literally double the size of the hospital.”
What are the biggest challenges facing your industry?
“The biggest challenge going forward is technology. ”¦ the cost of technology for telephones, computers, digital watches continues to drop. The cost of medical technology continues to go up. Our new CT scanner costs $2 million; I remember buying a CT scanner 20 years ago, it was $600,000 ”¦ So, one of our biggest challenges is how (to) pay for this extraordinarily expensive technology that really provides much better care than the old technology.”
On health care reform. There”™s still a lot to be worked out in Obama”™s plan but what are your thoughts?
“I think his intended goal of having everyone covered in a health plan is noble and, of course, appropriate. The way he”™s proposed paying for it, by slashing Medicare by $600 billion, will wreak havoc. My fear there, and I heard it from one or our surgeons, he”™s dropping out of Medicare because the fees have gone down so much it”™s not in his economic interest to be a participating physician ”¦ So if Obama hopes to fund the uninsured by slashing the payments to physicians and hospitals under Medicare that will backfire and eventually deny Medicare patients access to the health care system. So I don”™t think the funding mechanism is the right one.”
