A Snapshot of Some (Uncontrollable) Hospital Cost Drivers

A Snapshot of Some (Uncontrollable) Hospital Cost Drivers

Healthcare inflation around the world generally outpaces headline inflation by between 2-3%, yet between 2003 – 2013, South African healthcare inflation came in at 0.81% (excluding medical scheme inflation). Hospital prices are generally in line with headline inflation despite a number of outliers out of their control, like nursing salaries which are set in the public sector, a considerable weakening of the Rand/$ exchange rate which has pushed up even further the costs of medical technology (an already increasing expensive item), and electricity prices. And then factor in hospital running costs. The infographic below sets out the struggle private hospitals have to mitigate uncontrollable input costs.

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