NY hospitals fighting coronavirus hemorrhage hundreds of millions of dollars, criticize HHS disbursements

HHS began distributing billions in CARES Act relief funds on Friday

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Some New York hospital systems are reportedly losing up to $450 million a month as they treat coronavirus-stricken patients, while groups representing the hospitals say federal funding isn't properly prioritizing hot zones like New York City.

Hospital operators in many states have cut pay and even furloughed workers. For example, Boston Medical Center has furloughed 10% of its workforce, which adds up to approximately 700 workers. Such tough decisions come as hospitals and other facilities cancel elective procedures and lose that income because of coronavirus.

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New York's academic hospital systems are hemorrhaging between $350 million and $450 million a month, Kenneth E. Raske, president of the Greater New York Hospital Association, told The Wall Street Journal. Smaller hospitals "have their backs against the wall" and may have trouble paying workers in one to two weeks, Raske said.

The Greater New York Hospital Association and another group representing New York health care facilities, the Healthcare Association of New York (HANYS), take issue with how the Department of Health and Human Services disbursing relief funds to hospitals.

A patient is moved from Elmhurst Hospital Center to a waiting ambulance during the current coronavirus outbreak, Tuesday, April 7, 2020, in the Queens borough of New York. (AP Photo/Kathy Willens)

Disbursements are based on providers' 2019 share of total Medicare fee-for-service reimbursements. The CARES Act passed in March gives $100 billion in relief funds, including $30 billion that HHS began distributing on Friday.

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"HANYS appreciates that desperately needed funding has begun to flow to New York’s hospitals and other healthcare providers," HANYS President Bea Grause said in a statement. "However, we strongly oppose how these funds were allocated. HHS' methodology did nothing to prioritize support for COVID-19 hot spots like New York, and it leaves behind hospitals that serve higher shares of Medicaid, Medicare Advantage, uninsured and pediatric patient populations."

An HHS spokesperson told the Journal that more disbursements are on their way.

"Health and Human Services and the Administration will rapidly disburse additional distributions to providers in areas particularly impacted by the Covid-19 outbreak and providers that were not proportionately reflected in the first distribution such as children's hospitals, pediatricians and Medicaid providers," the spokesperson said.

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