As COVID-19-related hospitalizations in the U.S. surged, hospitals and health systems’ operating margins continued to fall in November, signaling a difficult winter ahead, according to a new report from healthcare consultancy Kaufman Hall.
The report, which uses data from over 900 hospitals gathered monthly over the last three years, shows inpatient volumes surpassed 2019 levels for the first time since the beginning of the pandemic, with patient days up 4% year over year.
But hospital discharges fell 5.1% from January through November of this year compared with the same period in 2019, resulting in an 8.7% increase in average length of stay year over year. There was also a 4.7% month-over-month increase in the average duration of hospital stays.
“These increases indicate an uptick in higher acuity cases, including Covid-19 patients,” the report states.
Not including funding received from the federal Coronavirus Aid, Relief, and Economic Security (CARES) Act, hospital operating margins fell by 56.4% (5.1 percentage points) for the period of January to November compared with the same period last year.
With the CARES funding, operating margins declined by 16.7% (1.9 percentage points) through November versus last year.
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Aside from inpatient volume, other volume metrics were down, according to the report. In line with previous reports, emergency department visits remained the hardest hit, falling 15.5% year-to-date. Hospitals with 300 to 499 beds saw the biggest decrease in ED visits, down 17.6% compared with last year.
Revenue metrics were mixed, the report shows. Inpatient revenue was up 12.7% year over year, but down by 0.6% in November compared with October. Outpatient revenue fell 0.6% year over year and 6% year-to-date.
Expenses, on the other hand, continued to rise, with total expense per adjusted discharge remaining well above 2019 levels — rising 14% from January to November, and up 17.3% compared with the same period last year.
“U.S. hospitals and health systems will face untold challenges in the months ahead,” Jim Blake, a managing director at Kaufman Hall and publisher of the National Hospital Flash Report, said in a press release. “Even with millions of doses of COVID-19 vaccine now in distribution, the virus is expected to continue its rapid spread and further strain vital healthcare facilities that already face limited resources and serious capacity issues. Now is the time — we must support our nation’s hospitals.”
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