This follows the outbreak of the corona virus which recently reached its peak with 2.6 million infected cases recorded so far. Experts have predicted that, billions of dollars will be lost in revenue by June 30th
According to Market Watch, many medical facilities in the USA, especially those in rural areas, will go out of business soonest. It has been predicted that hospitals will lose more than $200 billion in revenue by June 30,
according to a report by the American Hospital Association. The industry group estimates the total revenue hit from the pandemic at about $50 billion a month among health-care facilities since March as hundreds of these hospitals have gone into a state of bankruptcy.
So far, the United States has recorded 115 thousand deaths since the advent of the dreaded virus. The daily
spikes in the number of corona virus cases have led not only to the loss of lives but also to a financial drop in revenue in medical outlets across the country.
“The worst is yet to come,” said Michael Topchik, executive director of The Chartis Center for Rural Health, a Chicago-based management-consulting firm. It found out that, 453 of the country’s 2,000 rural hospitals were in danger of closing and 216 were identified as “most vulnerable.” The closure of rural hospitals will create an ever-growing disparity crisis in rural areas across the country leaving millions of Americans without immediate access to health care.
“It’s no exaggeration to say the sky is falling,” he said. “We’re already starting to see major hot spots in rural areas in Iowa, Nebraska and South Dakota. It doesn’t take a rocket scientist to see this is bad’’.
This is not different from the situation cited in an article published by VITAL RECORDS in April. It stated that there has been a 50 percent reduction in surgeries in Becker’s Hospitals nationwide and hospital revenues from elective procedures and surgeries are historically higher than revenue from emergency rooms and intensive care units.
According to Bita Kash PHD, MBA, FACHE, professor in the department of Internal medicine at the Texas ASM College of medicine. On average, the hospitals are losing $3000 per covid-19 patient due to the length of stay and resource intensity. Even amidst the government hospital stimulus fund to increase reimbursement for Covid-19 admission, hospitals are expected to still lose $1000 per covid-19 patient”
These losses in revenue have been met with a sharp increase in costs for hospitals since the beginning of the pandemic. COVID-19 outbreaks in some parts of the country have resulted in surges in hospitalizations and ICU patients. 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).15 COVID-19 related hospitalizations are associated with high costs of treatment.
The flow of red ink has left many operations scrambling to refinance debt, merge with other outfits or seek protection by declaring bankruptcy. These amongst several measures are being adopted by health care facilities to combat the drastic drop in finances caused by the Pandemic.
Becker’s Hospital CFO report reported that more than 120 hospitals across the country have laid off workers and the number is growing every day. It is unimaginable that physicians, nurses and hospital staff have been laid off, some having their working hours reduced as the world struggles with the pandemic.
Even amidst the “new normal”, one can only hope that the health sector breaks even so that jobs will be retained and the financial curve will rise again. This is however just a wish as it is evident almost all institutions around the world have been affected by the pandemic and layoffs are almost inevitable. Download Evolve Newspaper