Millions of members of hospital teams -- from doctors and nurses on the front lines to administrators behind the scenes -- have worked relentlessly to test and treat hundreds of thousands of COVID-positive Americans. Thanks to their herculean efforts, we've helped flatten the curve, saved lives, and have thus far prevented a system-wide collapse of the health care system that many feared just weeks ago. Unfortunately, COVID-19 has also caused an unprecedented financial crisis for hospitals and health systems that threatens its viability. The concern about the costly consequences of this crisis and its capacity to devastate the only place in the health care system where the doors are always open is real.
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UNEMPLOYMENT RATE, GOOD JOBS NEWS, TELL US THIS ABOUT CORONAVIRUS RECESSION An alarming new report from the American Hospital Association reveals the scale of the problem. Between March 1 and June 30 alone, hospitals and health systems will incur an estimated $202.6 billion in losses. Without even considering additional expenditures such as the acquisition of drugs, certain medical supplies, equipment, or increased labor costs that hospitals must incur to meet the demand, the staggering monthly average is slated to surpass $50 billion in losses. And that's just through June. If this pandemic persists for 12 to 18 months, as government authorities project, the impact could far exceed $202 billion in losses. Skyrocketing costs of preparing for a surge of COVID-19 patients, a forced shutdown of regular operations for non-emergency procedures, and treating a growing number of uninsured patients has added up to a triple whammy for hospitals: increased expenses; limited revenues; and an increased number of uninsured individuals. Hospital revenues plummeted as they canceled non-urgent surgeries and services to free up beds for coronavirus patients and preserve critical masks, gowns, and other personal protective equipment. In many communities, hospitals emptied out with the issuance of strict social distancing practices and stay-at-home orders in practically every state. Moreover, many individuals may continue to defer non-essential treatments, resulting in significant cash flow shortages and other challenges.
UNEMPLOYMENT RATE DROPS TO 13.3% IN MAY Additionally, experts anticipate that more than 40 million Americans could become uninsured, as unemployment climbs and people lose their employer-sponsored health plans. That imposes a substantial financial burden on America's hospitals, which deliver 24/7 care regardless of a patient's ability to pay. Meanwhile, the prices of critical medical supplies are skyrocketing. In New York City, hospitals have reported paying four times the typical price for gloves and 15 times the usual price for masks. Moreover, hospitals have faced increased labor costs from overtime and temporary staffing agencies, given patient demands, and front-line workers needing to self-isolate. The cost of treating a single COVID-19 patient who requires a ventilator can total nearly $90,000, according to estimates from the Kaiser Family Foundation.
GET FOX BUSINESS ON THE GO BY CLICKING HERE Many hospitals and health systems are also supporting physicians, nurses, and other health care workers by providing free childcare, housing, and transportation. Hospitals and health systems have made enormous sacrifices thus far -- but they can't defy financial gravity forever. Even before this pandemic, many faced significant financial pressures. Since 2010, 130 rural hospitals have closed their doors. Others were barely treading water. The Congressional Budget Office projects that half of hospitals could have negative margins by 2025 under current law, and this is before the financial challenges hospitals are now experiencing. As Congress considers additional actions, we urge legislators to make certain our nation’s hospitals, health systems, and the heroes fighting on the front lines are at the top of their priorities list. America's hospitals -- and their front-line heroes -- are facing a vicious, invisible enemy. They're willing to fight as long as it takes -- but they need the tools and resources to win this battle and remain always there, ready to care for their patients and communities.
Rick Pollack is the president and CEO of the American Hospital Association.