The recessionary wave that so far has largely spared the Baton Rouge region is nevertheless seeping in through the cracks. Even the recession-resistant health care sector is feeling it. Some hospitals and clinics, for instance, are reporting a decline in elective procedures. John Matessino, president of the Louisiana Hospital Association, says hospitals are keeping an eye on the future and that there’s plenty of belt-tightening going on — including his organization. “Hospitals are being cautious and very prudent about how they spend their money,” he says.
Mitch Wasden, CEO of Ochsner Medical Center Baton Rouge, says his hospitals haven’t seen much of a drop in elective procedures, though cash reserves are another issue. As with individual 401k’s, hospitals’ investments have taken a drubbing, he says. “When our reserves lose their value we have less money to buy capital, to build new buildings,” Wasden says.
Ochsner is looking at things month to month, making sure it doesn’t overextend itself on equipment or other big-ticket purchases while the economy is in its current state. Even normal times are tough, he notes. “What’s interesting about health care is it’s incredibly capital intensive and has all these financial challenges,” Wasden says. “A good year is when you break even or make a percent or two. They’re funny industries: It takes lot to keep them going. Financially, they don’t do real great all the time.”—Steve Clark
