Higher prices putting extra financial pressure on Dutch hospitals

Several hospitals threaten to run into financial problems this year due to the increased purchasing costs of, among other things, energy and food. That is the conclusion of a study by Intrakoop, the healthcare purchasing organization, and the Dutch Association of Hospitals (NVZ). The situation threatens to prevent hospitals from being able to make certain necessary investments, the organizations warned.

Hospitals are not only spending more on energy (+43.8 percent) but also on services and products this year. For example, the costs for office supplies (+8.5 percent), transport (+7.6 percent), and food (7.4 percent) are much higher than in 2021. The researchers surveyed 68 hospitals for the study.

Hospitals will spend an average of 5.8 percent more on purchasing costs this year, while the current agreements with health insurers only compensate them 1.83 percent for price increases. That leaves a “gap” of almost 300 million euros this year, according to Intrakoop and the NVZ. The hospitals have to cough up that amount themselves. The researchers also pointed out that several contracts with suppliers will expire later this year, which could mean new price increases. The costs are also expected to rise further after 2022.

The NVZ is concerned, worrying that increased costs jeopardize personnel, data exchange, sustainability, and IT investments. Discussions are underway at several “tables” about the expected shortages, but the NVZ cannot anticipate the outcome.

Price increases in energy and certain food products affect the whole of society, said the Ministry of Public Health, Welfare, and Sports in a response. “Just like in other sectors, this also affects the care sector. It is good to hear that the NVZ indicates that several consultations are underway.” According to the Ministry, the most important cost item in healthcare is labor costs.

The Ministry also pointed out that Intrakoop reported six weeks ago that almost all hospitals made a profit in 2021 and saw room for investment.

According to a spokesperson, the new price increases force the sector to limit itself to what is really necessary, a discussion that has been going on for some time. “The Ministry is in talks with all parties to make agreements in an Integrated Care Agreement to increase the sustainability of care,” said the spokesperson.

Interest group Health Insurers Netherlands also gave a short response: “In the coming period, everyone, including the healthcare sector, will have to deal with higher prices. We will therefore have to make a joint effort to keep premiums as low as possible and at the same time make healthcare providers financially healthy. After all, we pay for each other’s healthcare together.”