AHA REPORT FINDS THAT HOSPITALS EXPECT TO SUFFER "POTENTIALLY CATASTROPHIC" LOSSES OF $323.1 BILLION IN 2020 DUE TO COVID-19

On June 30, 2020, the American Hospital Association issued a report estimating that hospitals will continue to lose $120 billion, or an average of $20.1 billion a month, due to the coronavirus crisis from July to December 2020. Added to its previous estimate of $202.6 billion in losses from March through June, the AHA now estimates total losses for American hospitals of at least $323.1 billion in 2020. Although the AHA described these losses as “potentially catastrophic,” it also warned that these estimates could underrepresent hospitals’ full financial losses because they do not include such costs as caring for COVID-19 patients in the current or future surges or for the increased costs of acquiring drugs and non-PPE supplies. The report attributed the continuing losses to decreased patient volumes, which are expected to remain well below baseline levels through at least the end of 2020.

In a statement, AHA president and CEO Rick Pollack explained the significance of the report:

“This pandemic has shown once again why America’s hospitals and health systems are indispensable cornerstones of their communities. However, hospitals and health systems are in the midst of the greatest financial crisis in our history, as we continue to fight this pandemic at the same time that non-COVID patient visits remain low.”

The report concluded that “[t]hese losses put hospitals’ survival at serious risk” and implored Congress and the Administration to take urgent action to support the nation’s hospitals and health systems and their front-line staffs.

The AHA report was based on survey responses from 1,360 hospitals in 48 states and the District of Columbia, of which approximately one-third were in rural areas.

The AHA report is linked here. For Whatley Kallas, LLP’s article on the earlier AHA report, please click here.