Category Archives: The CARES Act

Northwell records $329M loss in first half of 2020

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https://www.beckershospitalreview.com/finance/northwell-records-329m-loss-in-first-half-of-2020.html?utm_medium=email

Northwell Health pairs with Israel Innovation Authority to develop new medical innovations | MobiHealthNews

Northwell Health, a 19-hospital system based in New Hyde Park, N.Y., ended the first half of 2020 with an operating loss despite a revenue increase year-over-year, according to recently released financial documents. 

In the six months ended June 30, the health system recorded revenue of $6.3 billion, up from $6.1 billion reported in the same period in 2019.

The health system saw its patient revenue drop 9.7 percent in the first half of the year to $5.1 billion, compared to the same period in 2019. The patient revenue drop was attributed to the COVID-19 pandemic.

Northwell’s expenses climbed in the first six months of this year to $6.6 billion, an increase of about 9.5 percent from the same period in 2019.

The health system recorded an operating loss of $249.6 million.

After accounting for nonoperating gains and losses, the system ended the first half of 2020 with a $329 million net loss. This compares to a net income of $393 million in the first half of 2019.

Northwell Health estimated that the negative financial hit from the COVID-19 pandemic in the six months ended June 30 was about $1.2 billion and attributed most of the financial impact to lower patient volume.

Through Aug. 28, Northwell has received $1.2 billion in grants from the Coronavirus Aid Relief and Economic Security Act. In the six months ended June 30, the health system recorded $754 million of this relief aid as “other operating revenue.”

“While the financial impact estimates noted above have been made using the best available information at the time, the ultimate net impact of the pandemic to Northwell and its financial condition is uncertain,” Northwell Health stated.

 

 

 

 

Cleveland Clinic posts $201.8M operating loss in Q2

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Find a Doctor | Cleveland Clinic

Cleveland Clinic ended the second quarter of this year with an operating loss, which the system attributed to financial damage tied to the COVID-19 pandemic. 

The 18-hospital system’s revenue declined to $2.3 billion in the second quarter of this year, down from $2.7 billion in the same period a year earlier, according to unaudited financial documents. In the first six months of this year, the health system experienced net patient service revenue shortfalls of more than $830 million, compared to plan, and incurred more than $165 million in COVID-19 preparedness costs. 

Cleveland Clinic reported operating expenses of $2.36 billion in the second quarter of this year, up from $2.34 billion in the same period last year.

The hospital system ended the most recent quarter with an operating loss of $201.8 million, compared to operating income of $116.2 million in the second quarter of 2019. Looking at the first six months of this year, Cleveland Clinic reported an operating loss of $241.7 million, compared to operating income of $152.4 million a year earlier. 

To help offset financial damage tied to the pandemic in the first six months of this year, Cleveland Clinic recognized $324 million in federal grants made available under the Coronavirus Aid, Relief and Economic Security Act. The health system also applied for and received $849 million in Medicare advance payments, which must be repaid. 

After factoring in investment gains of $477.5 million and other nonoperating items, Cleveland Clinic closed out the second quarter of this year with net income of $276.1 million. In the same period a year earlier, the health system posted net income of $256.4 million.

 

 

CMS to require positive COVID-19 test results for Medicare pay boost

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CMS to Pay For Hospital COVID-19 Care Furnished in Other Settings

CMS recently released guidance that includes a new requirement for hospitals to get a Medicare payment boost for caring for patients diagnosed with COVID-19. 

The Coronavirus Aid, Relief and Economic Security Act provided a 20 percent add-on payment to the inpatient prospective payment system diagnosis-related group rate for treating patients diagnosed with COVID-19. Until now, a physician’s documentation that a patient has COVID-19 was sufficient to receive the add-on payment. However, recent guidance from CMS adds the requirement to have a positive COVID-19 laboratory test documented in the patient’s medical record for the claim to be eligible for the add-on payment. The new requirement applies to admissions occurring on or after Sept. 1.

To receive the payment boost under the new guidance, the COVID-19 test must be taken within 14 days of the hospital admission. Only the results of viral testing that are consistent with CDC guidelines can be used. Tests performed by an entity other than the hospital, such as a local government-run testing center, can be manually entered into the patient’s medical record, CMS said.

Meeting the new requirement for the add-on payment could be difficult for hospitals, Ronald Hirsch, MD, vice president of the regulations and education group at R1 Physician Advisory Services, told Becker’s Hospital Review. 

“There is no way to indicate on a claim for a hospital patient that a test was positive or negative,” he said. “First, the hospital will manually need to go into every record for a patient with U07.1 as a diagnosis and look for a positive test in their own lab system. If one is not found, they will need to search the notes to see if the patient had a test in the 14 days prior to admission and if that test was positive. If there is a note the patient self-reported that they had a positive test, the hospital must decide if they must go through due diligence and attempt to get that actual test result for their records.”

In cases where there isn’t a positive test noted in the medical record, hospitals would need to notify the Medicare audit contractor that they are submitting a claim for a COVID-19 diagnosis that was made clinically, Dr. Hirsch said. The MAC would need to make the appropriate adjustment to ensure the 20 percent add-on payment is not made.

The “undue burden” that the new requirement will place on hospitals was one of the concerns the American Hospital Association highlighted in an Aug. 26 letter to CMS Administrator Seema Verma. The group is also concerned that requiring a positive COVID-19 test will lead to unnecessary additional testing.

“Basing the COVID-19 diagnosis code on clinical judgment alone — in line with coding rules — continues to be an important approach given that test accuracy may not be reliable, re-testing is unnecessarily onerous, and some communities face persistent testing shortages.” 

The AHA is urging CMS to drop the new requirement and allow provider documentation of a COVID-19 diagnosis to be sufficient for the add-on payment if the test result is unavailable. 

 

 

 

 

Hospitals face closure as $100B in Medicare loans come due

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HCA posts a billion-dollar profit, bolstered by CARES Act funds - MedCity News

CMS accelerated payments to hospitals and other healthcare providers at the beginning of the COVID-19 pandemic to help temporarily relieve financial strain. It’s time to begin repaying the Medicare loans but that isn’t possible for some rural hospitals, according to NPR. 

CMS expanded the Accelerated and Advance Payment Program in late March to help offset financial damage caused by the COVID-19 pandemic. CMS announced April 26 that it was reevaluating pending and new applications for advance payments due to the availability of funds under the Coronavirus Aid, Relief and Economic Security Act. As of May, CMS had paid out $100 billion in advance payments, the bulk of which went to hospitals. 

Hospitals and other healthcare providers are required to start repaying the Medicare loans this month. Most hospitals will have one year from the date the first loan payment was made to repay the loans, according to Kaiser Family Foundation.

Ozarks Community Hospital, 25-bed critical access hospital in Gravette, Ark., is one of the hospitals that applied for and accepted the Medicare loans. The hospital also received grants made available under the CARES Act, which do not have to be repaid.

CEO Paul Taylor said Ozarks Community Hospital’s revenue is still constrained, and he doesn’t know how it will pay back its $8 million Medicare loan. Payments for new Medicare claims will be offset to repay the loans, but losing those payments could force the hospital to close, Mr. Taylor told NPR.

“If I get no relief and they take the money … we won’t still be open,” he said.

Ozarks Community Hospital is one of more than 850 critical access hospitals in rural areas that received Medicare loans, according to NPR. Given the shaky financial footing of many rural hospitals before the pandemic, the strain of having Medicare payments withheld could be enough to force others to shut down. 

Before the pandemic, more than 600 rural hospitals across the U.S. were vulnerable to closure, according to an estimate from iVantage Health Analytics, a firm that compiles a hospital strength index based on data about financial stability, patients and quality indicators.

If the financial pressures tied to the pandemic force any of those hospitals to shut down, they’ll join the list of 131 rural hospitals that have closed over the past decade, according to the Cecil G. Sheps Center for Health Services Research.

 

 

 

 

Billions in Hospital Virus Aid Rested on Compliance With Private Vendor

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Billions in Hospital Virus Aid Rested on Compliance With Private ...

The Department of Health and Human Services told hospitals in April that reporting to the vendor, TeleTracking Technologies, was a “prerequisite to payment.”

The Trump administration tied billions of dollars in badly needed coronavirus medical funding this spring to hospitals’ cooperation with a private vendor collecting data for a new Covid-19 database that bypassed the Centers for Disease Control and Prevention.

The highly unusual demand, aimed at hospitals in coronavirus hot spots using funds passed by Congress with no preconditions, alarmed some hospital administrators and even some federal health officials.

The office of the health secretary, Alex M. Azar II, laid out the requirement in an April 21 email obtained by The New York Times that instructed hospitals to make a one-time report of their Covid-19 admissions and intensive care unit beds to TeleTracking Technologies, a company in Pittsburgh whose $10.2 million, five-month government contract has drawn scrutiny on Capitol Hill.

“Please be aware that submitting this data will inform the decision-making on targeted Relief Fund payments and is a prerequisite to payment,” the message read.

The financial condition, which has not been previously reported, applied to money from a $100 billion “coronavirus provider relief fund” established by Congress as part of the $2.2 trillion Coronavirus Aid, Relief and Economic Security Act, or CARES Act, signed by President Trump on March 27. Two days later, the administration instructed hospitals to make daily reports to the C.D.C., only to change course.

“Another data reporting ask,” a regional official in the health department informed colleagues in an email exchange obtained by The Times, adding: “It comes with $$ incentive. We really need a consolidated message on the reporting/data requests, this is past ridiculous.”

A colleague replied, “Another wrinkle. What a mess.”

The disclosure of the demand in April is the most striking example to surface of the department’s efforts to expand the role of private companies in health data collection, a practice that critics say infringes on what has long been a central mission of the C.D.C. Last month, the federal health department moved beyond financial incentives and abruptly ordered hospitals to send daily coronavirus reports to TeleTracking, not the C.D.C., raising concerns about transparency and reliability of the data.

Officials at the Department of Health and Human Services say that the moves were necessary to improve and streamline data collection in a crisis, and that the one-time reports collected in April by TeleTracking were not available from any other source.

“The national health system has not been challenged in this way in any time in recent history,” Caitlin Oakley, a department spokeswoman, said in a statement, adding that TeleTracking offered a “standardized national hospital capacity tracking system which provided more real-time, better informed data to make decisions from.”

But critics remain alarmed.

“In the middle of a pandemic, the Trump administration is using funds meant to support hospitals as a tool to coerce them to use an unproven, untrusted and deeply flawed system that sidelines public health experts,” Senator Patty Murray of Washington, the ranking Democrat on the Senate Health Committee, said in a statement.

In a statement, TeleTracking said it has three decades of experience providing health care systems “with actionable data and unprecedented visibility to make better, faster decisions.”

Still, public health experts and hospital executives are puzzled as to why the health agency chose such a difficult time to employ an untested private vendor rather than improve the C.D.C.’s National Healthcare Safety Network, a decades-old disease tracking system that was deeply familiar to hospitals and state health departments.

The N.H.S.N., as it is known, had built up trust over decades of working with hospitals and state health departments. Administrators were reluctant to make the switch.

“People — especially in public health and clinical health — are very protective of their data, so that trust factor is certainly an issue,” said Patina Zarcone, the director of informatics for the Association of Public Health Laboratories. “The fear of having their data leaked or misused or used for a purpose that they weren’t aware of or agreed to — I think that’s the biggest rub.”

Ms. Oakley said the C.D.C.’s system was “not designed for use in a disaster response” and could not adapt quickly in a crisis. Allies of the C.D.C. say withholding taxpayer dollars from the CARES Act in lieu of cooperation was an inappropriate effort to push hospitals into a system they were reluctant to use.

“It’s an absolutely enormous lever,” said William Schaffner, an infectious disease expert at Vanderbilt University. “It’s a compulsion to oblige institutions to report to this TeleTracking system because they knew if it weren’t tied to money, it wouldn’t happen.”

The Pittsburgh company has no obvious ties to the Trump administration. Rather, the push appears to be part of a broader privatization. The Health and Human Services Department has also asked the Minnesota-based manufacturer 3M “to create, and continuously update, a nationwide clinical data set on Covid-19 treatment,” according to documents obtained by The Times.

The effort is separate from the TeleTracking data collection. Tim Post, a company spokesman, said that because 3M already operates hospital information systems, it is “uniquely positioned,” with the permission of its clients, to submit information to the health department to help officials study disease patterns and recommend treatment options.

Some experts say this kind of cooperation with the private sector is long overdue. But the push also appears to be driven at least in part by an intensifying rift between the C.D.C., based in Atlanta, and officials at the White House and Department of Health and Human Services, the parent agency of the disease control centers.

Dr. Deborah L. Birx, the White House coronavirus response coordinator, and Mark Meadows, the president’s chief of staff, have taken a dim view of the C.D.C. and believe its reporting systems were inadequate. In a recent interview, Michael Caputo, the spokesman for Mr. Azar, accused the C.D.C. of having “a tantrum.”

Accurate hospital data — including information about coronavirus caseloads, deaths, bed capacity and personal protective equipment — is essential to tracking the pandemic and guiding government decisions about how to distribute scarce resources, like ventilators and the drug remdesivir, the only approved treatment for hospitalized Covid-19 patients.

The health agency has set up a new database, H.H.S. Protect, to collect and analyze Covid-19 data from a range of sources. TeleTracking feeds hospital data to that system.

But the public rollout of H.H.S. Protect has been rocky. The nonpartisan Covid Tracking Project identified big disparities between hospital data reported by states and the federal government and deemed the federal data “unreliable.”

The tension dates to March, when the novel coronavirus was making its first surge in the United States

On March 29, Vice President Mike Pence, charged by Mr. Trump with overseeing the federal response, informed hospital administrators that the C.D.C. was setting up a “Covid-19 Module,” and asked them to file daily reports which, he said, were “necessary in monitoring the spread of severe Covid-19 illness and death as well as the impact to hospitals.”

But around that time, TeleTracking submitted a proposal for data collection to the Trump administration, through an initiative, ASPR Next, created to promote innovation. On April 10, TeleTracking was awarded its contract.

The health department’s spokeswoman said the intent was to complement the C.D.C., not compete with it. Like the C.D.C.’s network, TeleTracking’s system requires manual reporting on a daily basis. But in June, Ms. Murray demanded the administration provide more information about what she called a “multimillion-dollar contract” for a “duplicative health data system.”

Some hospital officials also objected to the change.

“We have been directing our hospitals to N.H.S.N.,” Jackie Gatz, a vice president of the Missouri Hospital Association, wrote to a regional health and human services official in an email obtained by The Times, “and now this email with a much greater carrot — CARES Act distributions — is routing them to TeleTracking.”

When the order was delivered, flaws had already emerged in the new system.

“H.H.S. has acknowledged long wait times for those calling for technical support, and indicated that TeleTracking recently added 100 staff to respond to call center requests,” the American Hospital Association wrote to its members in a “special bulletin” on April 23. “They also are directing hospitals to leave a message if they are unable to reach someone live.”

At the time, hospitals had the option of making their daily coronavirus reports to TeleTracking or the C.D.C. Few were using the new database.

In June, the administration again used a stick to demand that hospitals report to TeleTracking, this time in order to obtain remdesivir. By July, with Dr. Birx pushing to bolster hospital compliance, the administration instructed hospitals to stop filing daily reports to the C.D.C. and to send them to TeleTracking instead.

One official at a major academic hospital, who spoke on the condition of anonymity for fear of angering officials in Washington, said the switch left her “unable to sleep at night.”

“Ethically, it felt like they had taken a very trusted institution in the C.D.C. and all of that trust built up with many public health people,” she said, then “moved it onto a politically and financially motivated portion of this response.”

Health and human services officials say the government now has a much more complete picture of hospital bed capacity, with more than 90 percent of hospitals reporting. But Dr. Janis M. Orlowski, the chief health officer for the Association of American Medical Colleges, who worked with Dr. Birx and the administration to bolster hospital reporting, said that she was “stunned” by the switch and that the increase in reporting came because of efforts by her group and others, not the TeleTracking system.

Dr. Orlowski said the data and maps now published on the administration’s H.H.S. Protect data hub are “just not as sophisticated as the C.D.C.”

The switch also generated pushback inside the C.D.C., where officials have refused to analyze and publish TeleTracking data, saying they could not be assured of its quality and had continuing questions about its accuracy, according to a senior federal health official.

Administration officials say the C.D.C. is working with a little-known office in the executive branch — the United States Digital Service — to build a “modernized automation process” in which data will continue to flow directly to the Department of Health and Human Services. But the project is in its infancy, one senior federal health official said.

Critics say that if the department believed the C.D.C.’s health network had problems, those should have been fixed.

“We have a public health system that depends upon communication from hospitals to state health departments to the C.D.C.,” said Dr. Schaffner, the Vanderbilt University infectious disease expert. “It’s very well established. Can it be improved? Of course. But to cut out the public health infrastructure and report to a private firm essential public health data is misguided in the extreme.”

 

 

 

2020 Hospital Operating Margins Down 96% Through July

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https://www.prnewswire.com/news-releases/2020-hospital-operating-margins-down-96-through-july-301116888.html

Ship in a Storm | ICOExaminer

Hospital Operating Margins have plunged 96% since the start of 2020 in comparison with the first seven months of 2019, according to a new Kaufman Hall report, as uncertainty and volatility continue in the wake of the COVID-19 pandemic.

Those results do not include federal funding from the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Even with that aid, however, Operating Margins are down 28% year-to-date compared to January-July 2019.

Operating Margins fell 2% year-over-year in July without the CARES Act relief, according to the latest edition of Kaufman Hall’s National Hospital Flash Report. Hospitals also saw flat year-over-year gross revenue performance in July, continued high per-patient expenses, and a fifth consecutive month of volumes falling below 2019 performance and below budget.

From June to July, however, hospital Operating Margins were up 24%, likely due to a backlog in demand resulting from the shutdown of many non-urgent services in the early months of the pandemic.

“COVID-19 has created a highly volatile operating environment for our nation’s hospitals and health systems,” said Jim Blake, managing director, Kaufman Hall. “Hospitals have shown some incremental signs of potential financial recovery in recent months. Unfortunately, there is no guarantee these trends will continue, and hospitals still have a long way to go to recover from devastating losses in the early months of the pandemic.”

July volumes continued to fall year-over-year, but showed some signs of potential recovery month-over-month. Adjusted Discharges were down 7% compared to July 2019, but up 6% compared to June 2020. Adjusted Patient Days were down 4% year-over-year, but up 7% month-over-month. Adjusted Discharges are down 13% and Adjusted Patient Days are down 11% since the start of 2020, compared to the first seven months of 2019.

Hospital Emergency Department (ED) volumes have been hardest hit, falling 17% year-to-date compared to the same period in 2019, down 17% year-over-year, and 13% below budget in July. Surgery volumes saw some gains with the continued resumption of non-urgent procedures pushing Operating Room Minutes up 3% month-over-month and 4% above budget in July, but they remain down 15% year-to-date.

Not including CARES Act relief, Gross Operating Revenues were essentially flat year-over-year and 2% below budget for the month, but have fallen 8% year-to-date compared to the same period in 2019. Inpatient Revenue is down 5% year-to-date and fell 3% below budget in July, but increased 1% year-over-year. Outpatient Revenue is down 11% year-to-date, 1% year-over-year, and 2% below budget.

Hospitals nationwide also continued to see higher per-patient expenses despite having fewer patients. Total Expense per Adjusted Discharge has jumped 16% year-to-date compared to the same seven-month period in 2019, and rose 9% year-over-year and 5% above budget in July. Labor Expense per Adjusted Discharge is up 18% year-to-date and rose 9% year-over-year and 5% above budget in July. Non-Labor Expense per Adjusted Discharge has increased 15% during the first seven months of 2020 and jumped 11% year-over-year and was 5% above budget for the month.

The National Hospital Flash Report draws on data from more than 800 hospitals.

 

 

 

 

Sutter posts $857M loss in H1 on investment, operational declines

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California's Sutter Health reaps rewards from investments in ...

Dive Brief:

  • Sutter Health had a staggering loss of $857 million in the first half of the year as the Northern California health was bruised by the pandemic. That’s almost a $1.4 billion drop in income compared to the first half of last year, a plummet Sutter management largely blamed on investment and operational losses in its latest financial filing posted Thursday.
  • The virus shuttered operations for a period of time, driving Sutter’s revenue down 8% to $6.1 billion during the first half of the year. Expenses climbed nearly 2%, contributing to an operating loss of $557 million.
  • Still, the nonprofit noted it did experience a significant rebound in its investments in the second quarter after weathering the devastating effects of the first quarter.

Dive Insight:

Sutter joins other major nonprofit health systems in posting net losses for the first half of the year despite receiving hundreds of millions in federal grants to help offset headwinds brought on by the pandemic.

Recently, both Renton, Washington-based Providence and Arizona-based Banner Health posted losses for the first half of the year — $538 million and $267 million, respectively. Dampened revenue and downturns in investments contributed to their losses.

The federal government has funneled billions of dollars to providers across the country in an attempt to help them weather the downturn in patient volumes. Sutter noted in its filing that it’s received $400 million in federal relief funds so far, though that wasn’t enough to push the health system back into the black. Sutter operates 29 hospitals and enjoys a large presence in Northern California.

Sutter reported fewer admissions and emergency room visits in the second quarter compared to the prior-year period, down about 10% and 19%, respectively.

The pandemic was quick to wreak havoc on Sutter’s finances during the first quarter, in which the system reported an operating loss of $236 million and a net loss of almost $1.1 billion.

The coronavirus is also serving as a drag on its ratings. In April, two of the three big ratings agencies downgraded Sutter Health’s rating.

In part, Moody’s attributed the downgrade to Sutter’s weaker profitability profile. In its rationale, Moody’s said, “Following a second year of weaker results, margins in 2020 are likely to remain under pressure due to COVID-19 related disruptions, ongoing performance challenges at some of Sutter’s facilities, and continued reimbursement pressure.”

Also weighing on Moody’s rating is the $575 million settlement expected to be paid this year to resolve antitrust issues. Last year, the health system averted a trial over antitrust concerns after agreeing to a settlement with California regulators. Sutter agreed it would end any contracts that require all of its facilities to be in-network or none of them and cap out-of-network charges, among other stipulations.

 

 

 

 

Revenues and volumes have fallen ‘off a cliff’ hospital executives tell American Hospital Association

Posted on by • Posted in American Hospital Association (AHA), American Medical Association (AMA), American Nurses Association, Cash, Cash Management, Coronavirus, Deferred Healthcare, Economic Crisis, Economic Stimulus, Elective Procedures, Elective Surgery, Emergency Care, Health System, Hospital, Hospital Industry, Liquidity, Net Income, Nonoperating Income, Operating Expense Reduction, Operating Expenses, Operating Income, Operating Margin, Operating Performance, Operating Revenue, The CARES Act • Leave a comment

https://www.healthcarefinancenews.com/news/aha-releases-case-studies-us-hospitals-and-health-systems-highlighting-financial-challenges

Revenues and volumes have fallen 'off a cliff' hospital executives ...

Eight health systems in AHA case study are asking Congress for more relief funding.

The American Hospital Association has released eight case studies from hospitals and health systems across the country that highlight how systems of different shapes and sizes are reacting to the financial challenges posed by COVID-19.

The case studies include Kindred Healthcare and TIRR Memorial Hermann in Houston; AdventHealth Central Florida Division in Orlando, Florida; the Loretto Hospital in Chicago; Kittitas Valley Healthcare in Ellensburg, Washington; Washington Regional Medical Center in Fayetteville, Arkansas; Banner Health in Phoenix; UR Medicine Thompson Health in Canandaigua, New York; and the Queen’s Health Systems and the Queen’s Medical Center in Honolulu.

Across the board, every case study revealed that hospitals and health systems are asking Congress for more relief funding.

“We are begging for more assistance and more help because we can’t keep moving forward,” said Michael Stapleton, the president and CEO of UR Medicine Thompson Health in New York.

WHAT’S THE IMPACT?

In Texas, the state with the third most COVID-19 cases, Kindred Healthcare and TIRR Memorial Hermann have begun to rely on inpatient rehabilitation facilities and long-term acute care hospitals to treat COVID-19-positive and medically complex recovering COVID-19 patients.

“In particular, as communities and hospitals struggled to meet ICU capacity needs, these hospitals stepped forward to take care of COVID-19-positive patients and others to help provide beds for more COVID-19-positive patients,” the case study said.

However, even with assistance from local facilities, post-acute care providers have incurred increased costs to prepare for and treat COVID-19-positive patients and complex post-COVID-19 patients.

“When you look at lost revenue and volumes, and the additional costs of ramping up to prepare for COVID-19, whether it’s personal protective equipment, respiratory systems, medications or facility infrastructure changes, there are significant dollars associated with that,” said Jerry Ashworth, the senior vice president and CEO at TIRR Memorial Hermann.

AdventHealth in Florida has taken financial hits from declining elective procedures and purchasing personal protective equipment. The company says it has lost $263 million since the start of the pandemic and has spent $254 million sourcing PPE.

“Florida is in the middle of the crisis,” said Todd Goodman, division chief financial officer of AdventHealth. “Our current COVID numbers are four times higher than the peak that we had back in April. We are bringing in higher-priced nurses and staff from other parts of the nation, because of a rapid increase in inpatient census. We are in a different place today than we were even six weeks ago.”

COVID-19 has disproportionately affected communities of color across the country, but especially in Chicago, where 30% of the population is Black. Forty-six percent of all COVID-19 cases and 57% of all deaths are Black people.

Despite having 70% of its admissions being related to COVID-19, the Loretto Hospital in Chicago has not received any funds from the Coronavirus Aid, Relief, and Economic Security Act hot spot distribution.

“Our COVID-19 unit is full and has been for the last three months; we’re now at 296 COVID-19 patients [on July 16] and yet we’ve not received any of the COVID-19 high impact ‘hot spot’ payments,” said George Miller, the president and CEO of the Loretto Hospital. “We got the Small Business Administration loan to help keep our team members employed.”

Kittitas Valley Healthcare in Washington was among the first in the country to feel the impact of COVID-19. The rural delivery system and its critical access hospital postponed elective surgeries and many other nonessential services in response.

“Our revenues and volumes fell off a cliff,” said Julie Petersen, the CEO of Kittitas Valley Healthcare. “Our orthopedics programs, our GI [gastrointestinal] programs and cataract surgeries evaporated.”

Now, the hospital is off its original 2020 net revenue projections by $8.4 million.

After seeing a 12% rise in COVID-19 cases over a two-week period in Fayetteville, Arkansas, the Washington Regional Medical Center had 96% of its 40 intensive care unit beds occupied, a 20-bed COVID-19 ICU was completely full, and 298 of the facility’s 315 adult beds were occupied.

Taking care of these patients put the health system in a financial crisis. Its net patient revenue declined by $14 million in April. It furloughed 350 of its 3,300 employees and reduced the hours of 360 full-time workers, according to Larry Shackelford, the president and CEO of Washington Regional Medical Center.

On July 12, Banner Health in Arizona had more than 1,500 inpatients who either tested COVID-positive or are suspected of having COVID-19, representing 45% of the COVID-19 inpatient hospitalizations in the state, according to Dr. Marjorie Bessel, the chief clinical officer at Banner Health.

Banner expects operating losses of $500 million for 2020, compared to its initial expectations, with expected revenue losses approaching $1 billion for the year, according to the case study.

By mid-March, New York had 15 times more COVID-19 cases than any other state, according to the case study. Like the rest of the state, UR Medicine Thompson Health shut down many of its services, resulting in “insurmountable” financial losses and staff furloughs.

“Our first projection was a $17 million loss through the year-end,” Stapleton said. “We lost half of March, all of April and half of May. The hospital has received only $3.1 million from the CARES Act tranche payments.”

Although the Queen’s Health Systems and the Queen’s Medical Center in Hawaii are starting to reschedule appointments, surgeries and procedures that had been delayed by COVID-19, patients aren’t coming back as anticipated.

“Even with the pent-up demand for elective procedures, minimally invasive and even short-stay procedures are still down by about 18%. We are seeing our in-person clinic visits down by about 14%, and the emergency department (ED) is the one that surprised us the most – down by 38%,” said Jason Chang, president of the Queen’s Medical Center and chief operating officer of the Queen’s Health Systems and the Queen’s Medical Center.

The systems lost $127 million between March and May, according to Chang. He says the projected losses are about $60 million for 2021, but could reach $300 million if Hawaii experiences a second wave of COVID-19.

THE LARGER TREND

The AHA has cited $323 billion in losses industry-wide due to the ongoing COVID-19 pandemic, with U.S. hospitals anticipating about $120 billion in losses from July to December alone.

It was joined by the American Nurses Association and the American Medical Association to ask Congress to provide additional funding to the original $100 billion from the CARES Act. In a letter sent in July, the organizations asked for “at least an additional $100 billion to the emergency relief fund to provide direct funding to front line health care personnel and providers, including nurses, doctors, hospitals and health systems, to continue to respond to this pandemic.”

 

 

 

 

Geisinger chooses VisitPay as its new digital financial platform

Posted on by • Posted in Economic Stimulus, Health System, Hospital, Paycheck Protection Program, Point of Service Collections, Rev Cycle Management, Revenue Cycle, The CARES Act • Leave a comment

https://www.healthcarefinancenews.com/news/geisinger-chooses-visitpay-its-new-digital-financial-platform

Geisinger chooses VisitPay as its new digital financial platform ...

The partnership will give Geisinger’s 1.5 million customers and 13 hospitals a consolidated and personalized healthcare billing experience.

Geisinger, a health system serving Pennsylvania and New Jersey, announced this week a new partnership with the digital financial service platform VisitPay.

The partnership will give Geisinger’s 1.5 million customers and 13 hospitals a consolidated and personalized healthcare billing experience through VisitPay.

Its financial services integrate within existing electronic medical record systems and can equip internal revenue cycle teams with a customer service portal for employees to manage patient obligations, customer requests and internal workflow.

Additionally, VisitPay’s system uses artificial intelligence and machine learning to give patient payment recommendations. It also offers point-of-service devices to collect payments and co-pays up front.

For patients who are offline, the platform provides the option to choose between electronic or paper billing statements.

WHY THIS MATTERS

The COVID-19 pandemic has created “historic financial pressures for America’s hospitals and health systems,” according to the American Hospital Association.

The AHA estimated a financial impact of $202.6 billion in losses for hospitals and health systems between March and June as a result of COVID-19.

As a result, many hospitals and health systems are looking for ways to turn around their finances.

VisitPay has found that using greater price transparency and more personalized and convenient payment options may be the way to do so. The company conducted research showing that while healthcare providers experienced a 47% decline and daily total patient payments between March and May, those who used VisitPay’s platform saw a 10% increase in patient payments.

The platform uses a five-point plan designed to give patients the flexibility they need while keeping them engaged in the financial cycle, ensuring providers sustain revenue.

The plan’s points are to maximize self-service, communicate purposefully, make precise offers, target relief appropriately, and balance patient satisfaction and payment rate.

THE LARGER TREND

To help health systems recover financially from the pandemic, Congress allocated $175 million in the Provider Relief Fund of the Coronavirus Aid, Relief, and Economic Security Act and in the Paycheck Protection Program and Healthcare Enhancement Act.

However, many hospitals are still feeling financial burdens and have asked for more assistance.

As they wait for aid, many hospitals have needed to reduce expenses through layoffs and furloughs. Others have created new strategies to recoup lost revenue, some of which include relying on telehealth to continue seeing patients, creating flexible workflows and ensuring positive patient engagements.

ON THE RECORD

“At Geisinger our sole focus is to make health easier for the communities we serve — it is our North Star and guides all of our strategic decisions,” said Kevin Roberts, the executive vice president and CFO at Geisinger. “Partnering with VisitPay is the latest step in that direction and highlights our mission to make healthcare more accessible for our patients, especially given the financial challenges caused by COVID-19. We are thrilled to roll out VisitPay’s solutions as we feel they will be extremely beneficial to our communities.”

 

 

 

 

Providence posts $538M loss, lays out 3-part strategic plan

Posted on by • Posted in Cost Management, Cost Reduction, Economic Stimulus, Elective Procedures, Elective Surgery, Health System, Hospital, Hospital Industry, Net Income, Nonoperating Income, Operating Expense Reduction, Operating Expenses, Operating Income, Operating Margin, Operating Performance, Operating Revenue, Pandemic, Reorganization, Strategy, The CARES Act • Leave a comment

https://www.beckershospitalreview.com/finance/providence-posts-538m-loss-lays-out-3-part-strategic-plan.html?utm_medium=email

Providence St. Joseph Health Consolidates 14 Hospitals in SoCal ...

Providence, a 51-hospital system based in Renton Wash., received $651 million in federal grants in the first half of this year, but it wasn’t enough to offset the system’s losses tied to the COVID-19 pandemic. 

The health system reported revenues of $12.5 billion in the first six months of this year, down from $12.6 billion in the same period a year earlier, according to financial documents released Aug. 17. Though the health system reported a rebound in patient volumes after the suspension of non-emergency procedures in March and April, net patient service revenue was down 10 percent year over year.

Providence’s expenses also increased. For the first two quarters of this year, the health system reported operating expenses of $12.7 billion, up 3 percent year over year. The increase was attributed to higher labor costs and increased personal protective equipment and pharmaceutical spend.

Reduced patient volumes combined with increased costs drove an operating loss of $221 million in the first half of this year. In the first half of 2019, Providence reported operating income of $250 million.

After factoring in nonoperating items, Providence ended the first six months of 2020 with a net loss of $538 million, compared to net income of $985 million in the same period of 2019.

To help offset financial damage, Providence received $651 million in federal grants made available under the Coronavirus Aid, Relief and Economic Security Act. 

“We knew we were in for a marathon the moment we admitted our first patient with COVID-19 seven months ago,” Providence President and CEO Rod Hochman, MD, said in an earnings release. “Our caregivers have been on the front lines ever since, and we are incredibly proud and grateful for all they are doing to serve our communities during the greatest crisis of our lifetime.”

In its earnings release, Providence mapped out a three-part plan for the future. As part of that plan, the system said it is focused on improving testing capacity and turnaround times and advancing clinical research and best practices in the treatment of COVID-19. The system is also revising its operating model and cost structure.