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AHA Estimates Over $200 Billion in COVID-Related Hospital Revenue Losses


May 05, 2020

The American Hospital Association (AHA) released a report this week which estimates that between March 1 and June 30, 2020, hospitals and health systems across the country will experience $202.6 billion in losses because of COVID-19 expenses and lost revenue.

 "America's hospitals and health systems have stepped up in heroic and unprecedented ways to meet the challenges caused by COVID-19. However, the fight against this virus has created the greatest financial crisis in history for hospitals and health systems," said AHA President and CEO Rick Pollack.

In the wake of the COVID-19 outbreak, hospitals and health systems across the globe have been forced to adjust methods of care and offered services in efforts to combat the disease. More than 1 million Americans have become infected, straining the US health care system and its workforce.

AHA’s report explained that the mandatory cancellation of elective procedures and nonessential services resulted in adjusted discharges—down 13% from the previous year. Many health care providers have expressed concern that patients are actually “forgoing important care, such as chronic disease management, which can further jeopardize their health” because of adjusted regulations caused by COVID-19.

Four analyses were used by AHA to estimate the financial impact of these challenges. They were as follows:

  • net financial impact of COVID-19 on hospital costs;
  • total revenue losses from cancelled surgeries and other services;
  • the additional costs associated with purchasing needed PPE; and
  • the costs of the additional support some hospitals are providing to their workers.

These losses in revenue have been met with a sharp increase in costs for hospitals since the beginning of the pandemic,” stated the report. “The Centers for Disease Control and Prevention estimated the cumulative hospitalization rate to be 29.2 per 100,000 people, with even higher rates for Medicare-aged individuals (95.5 per 100,000) and adults aged 50-64 (47.2 per 100,000).”

"While we appreciate the support and resources from Congress and the Administration, many hospitals are still on the brink,” said AHA President and CEO Rick Pollack. “We need further support and resources to ensure that we can continue to deliver the critical care that our patients and communities are depending on while also ensuring that we are prepared for the continuing challenges we face from this pandemic as well as other potential emergencies."

—Edan Stanley

                                     

Reference:

American Hospital Association. New AHA Report Finds Financial Impact of COVID-19 on Hospitals and Health Systems to Be Over $200 Billion through June [press release]. https://www.aha.org/special-bulletin/2020-05-05-new-aha-report-finds-financial-impact-covid-19-hospitals-and-health. Published May 5, 2020.

 

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