Stanford Report Online

Stanford Report, March 29, 2001

Stanford Hospital and Clinics Restructuring Fact Sheet

Stanford has a world-class medical center, including two hospitals and a medical school, but its mission is in jeopardy and the hospital's long-term survival is at risk unless we stem the losses we are facing.

  • Stanford Hospital is one of the top ten teaching hospitals in the country.
  • Stanford Hospital performed the world's first heart and lung transplant.
  • Last year alone, Stanford Medical School and the hospitals trained more than 2,000 medical students, graduate students and post-doctoral trainees.
  • Stanford currently has more than 1,400 active, medical research projects.
  • Without changes, Stanford Hospital could lose up to $40 million this fiscal year and up to $70 million next year.
  • Government reimbursements cover less than 50% of the hospitals' costs.

The health care system is broken and Stanford's hospitals cannot continue to provide services that we are not fairly compensated for.

  • Two-thirds of California's hospitals are losing money.
  • All academic medical centers are affected, and some will merge or declare bankruptcy in the next five years.
  • Academic medical centers provide nearly 40% of care for the nation's 44 million uninsured.
  • The 1997 Balanced Budget Act cut the amounts the federal government paid academic medical centers. At Stanford Hospital, this means an $80 million drop in revenue in the past four years.

Stanford's hospitals are not being paid the fair cost for the services we provide. To balance the budget we must consider: 1) renegotiating or exiting health plan contracts; 2) transferring some programs to other providers; and 3) closing some money-losing programs.

  • Stanford Hospital is currently being paid as little as 23 cents on the dollar by our health plans.
  • Stanford Hospital provides more than $25 million of unreimbursed care each year.
  • This year alone, Stanford Hospital faces a projected $40 million payment gap from Medicare and Medi-Cal patients.