Health systems losing $1.4B to COVID-19--per day
Health systems across the U.S. are losing an average of $1.4 billion in daily revenue due to a decline in patient volume amid the COVID-19 pandemic,…
Health systems across the U.S. are losing an average of $1.4 billion in daily revenue due to a decline in patient volume amid the COVID-19 pandemic, new data shows.
Crowe LLP, a Chicago-based public accounting, consulting and technology firm, reported May 1 that hospitals experienced a 56% reduction in traffic between March 1 and April 15, as both patients and doctors reprioritized or delayed normal services to prepare for an expected surge in COVID-19 cases.
While some cities, like San Francisco, saw a brief rise in patients being treated for the novel coronavirus, that trend quickly reversed itself after the worst of the public health crisis had passed in certain areas.
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Crowe found that, currently, inpatient admissions are running more than 30% below norms, compared to January 2020, and emergency room visits were down 40%. Meanwhile, observation services had dipped by 47%, outpatient ancillary services were down 62% and outpatient surgery volume had declined 71%.
“Hospitals and governments prepared for a surge in patient volume to treat those infected with the novel coronavirus,” said Brian Sanderson, managing principal of health care services at Crowe. “However, any possible surges that might have been expected due to COVID-19 patient volume appear to be dramatically offset by a significant decline in volume in all other areas.”
Crowe’s Revenue Cycle Analytics software captured patient transactions for nearly 1,500 hospitals and more than 100,000 physicians nationally to assess accounts receivable valuation and net revenue analyses. Within its benchmarking database, Crowe analyzed a portfolio that included 45 states and 707 hospitals within Medicaid-expansion states and 445 hospitals in non-expansion states, as of 2019, to produce comparative metrics.
According to the report, California, which had seen some hotspots of COVID-19 activity, overall patient volume was down 50%, while Florida and Texas experienced declines of 47% and 56%, respectively. In Illinois, which has not yet seen the predicted surges of COVID-19 hospital care, overall patient volume is 59% below norms–driven by a 76% reduction in outpatient surgeries, the Crowe report said.
The report found that each hospital’s revenue recovery plan would need to address a range of operational and clinical challenges, including a pent-up demand for elective surgeries, possible copay forgiveness and new rules regarding charge capture and telehealth.
Many patients would be hesitant to return to clinical settings unless they were assured that the environment is free from contagious elements, and the average hospital would need to run at 110% of previous capacity for six months straight to recover lost patient volume, according to the report.
“In many ways, America’s hospitals are and will remain ground zero for the COVID-19 crisis,” Sanderson said. “Despite government monetary relief and supply assistance, the economic effects of March and April 2020 will affect the operations of our health care system long after the curve flattens or dissipates.”
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