A nationwide shortage of healthcare workers made worse by the pandemic, and hospital and health systems’ increased reliance on contract labor, is driving expenses upward and contributing to steep declines in profit margins, according to a Special Workforce Edition of Kaufman Hall’s National Hospital Flash Report.

On a recent Governing Health Podcast, Ken Kaufman and Michael W. Peregrine shared their insights about key concerns on topics that have less to do with traditional operational matters, and more to do with social and economic issues of concern to the workforce and the mission.

Healthcare is undergoing a major realignment as stakeholders compete for consumers’ attention. The different strategies intersect at the physician’s office, and physicians today face an unprecedented array of practice options.

The first quarter of 2022 will undoubtedly be one of the most financially challenging periods for not-for-profit hospitals.

Physician practices nationwide had a busy start to 2022, as physician productivity, compensation, and revenues all rose with higher patient volumes from Q4 2021 to Q1 2022.

U.S. hospitals and health systems fared better in March following a difficult start to the year due to January’s devastating Omicron surge. While repercussions of the surge persist, hospitals saw early signs of relief as outpatient volumes and revenues returned and expenses eased with fewer high acuity patients.