HAP's Latest News

America’s Hospitals Face $54B in Losses amid COVID-19

Increased costs, delayed care, higher-acuity patients contribute to significant financial challenges

September 21, 2021

America’s hospitals could lose an estimated $54 billion in net income during 2021, according to a new analysis from Kaufman, Hall & Associates, LLC.

The report, released today by the American Hospital Association (AHA), outlines the staggering financial challenges facing U.S. hospitals during the COVID-19 pandemic, including higher costs for labor, drugs, and supplies, as well as patients delaying care and scheduled procedures.

Hospitals are facing billions in lost income even after taking into account federal Coronavirus Aid, Relief, and Economic Security (CARES) Act funding, the report notes.

“America’s hospitals and health systems continue to face significant, ongoing instability and strain as the COVID-19 pandemic endures and spreads,” Rick Pollack, AHA president and CEO, said in a statement. “With cases and hospitalizations at elevated levels again due to the rapid spread of the Delta variant, physicians, nurses and other hospital caregivers and personnel are working tirelessly to care for COVID-19 patients and all others who need care.”

Hospitals are experiencing profound challenges that will continue throughout the rest of the year, Pollack said.

Among the key highlights from the report:

  • Hospital margins:  Median hospital margins could be 11 percent below pre-pandemic levels by the end of 2021. One-third of hospitals could end 2021 with negative margins
  • Critical support:  Without CARES funding, losses in net income would be as high as $92 billion
  • Trends in patient care:  Hospitals are seeing higher costs from caring for sicker patients and fewer outpatient visits. The median length of stay is up 8 percent year-to-date compared to 2019 for most hospitals. It is up as high as 18 percent for some hospitals with 500 beds or more

The seven-day average of new hospital admissions for patients with COVID-19 increased 488 percent from mid-June to mid-September, according to data from the Centers for Disease Control and Prevention. The report illustrates the continued need to support hospitals across the nation and the considerable financial challenges that will persist through 2021.

HAP will continue to advocate for resources and support that enable the commonwealth’s hospitals to deliver outstanding care. 

For more information, contact Laura Stevens Kent, HAP’s senior vice president, strategic integration.