Hospitals lost money during COVID
Stimulus funds helped offset losses for most
IT MAY BE counterintuitive, but experts have long been saying that the public health emergency actually lowered the amount of money being spent on health care.
The reason is that people have been deferring non-emergency care. So overall appointments for health care have decreased, even as providers are tasked with responding to COVID-19 and related demands for testing and vaccinations.
Two recent reports released by the Center for Health Information and Analysis put new numbers on this trend.
One report, released Thursday, measures hospital profitability for fiscal 2020. (Some hospitals ended their fiscal year in June 2020; others in September.) It found that hospital revenue from patient services dropped by $1.4 billion last year, while hospitals’ expenses increased by $1.3 billion. Hospital profitability was lower than the prior year, even after accounting for $1.8 billion in COVID relief spending.
Hospital officials are likely to use the new reports to advocate for additional relief money from the federal and state governments. Steve Walsh, president and CEO of the Massachusetts Health and Hospital Association, said in a statement that the data “confirms the tremendous financial challenges our providers have faced throughout the pandemic.” He noted that costs have increased for setting up vaccination clinics, buying personal protective equipment, and reducing patient capacity due to spacing requirements, at the same time as elective and other in-person procedures were put on hold. “Additional financial support is needed as our providers continue their response and navigate a new normal,” Walsh said.