ELMHURST – Over the next year, Edward-Elmhurst Health will identify $50 million in cost reductions, including both labor and non-labor expenses, according to a news release from the health system.
The reductions will represent about 4 percent of total expenses, the release stated.
“In order for Edward-Elmhurst Health to continue to be the strong, stable organization that it is today, we must carefully manage our financial situation,” CEO Mary Lou Mastro said in the release. “Hospitals recognize that our existing cost structures are not sustainable. We must become more efficient and ensure that our expenses are well managed.”
Hospitals across the country are facing unprecedented financial pressure, according to the release.
Edward-Elmhurst Health has seen the number of patients in both Medicare and Medicaid plans increase. These government programs do not cover the costs of patient care, the release stated.
Insured patients also do not always have the resources to pay their higher co-pays and deductibles, which has contributed to increasing bad debt, according to the release.
The number of individuals with commercial insurance has declined, and commercial payments do not keep up with medical inflation, the release stated.
Charity care also has increased, as have pharmaceutical and medical supply costs, according to the release.