(Photo courtesy of Washington State University)
Washington hospitals say they are bleeding money at levels they say are unsustainable as they sound the alarm about the possibility of reducing available care.
The members of the Washington State Hospital Association say that with expenses outpacing revenue and losses on their investments, they’ve had net losses of $1.75 billion dollars in the first six months of this year.
WSHA’s chief financial officer, Eric Lewis, says total operating revenues in the first half of 2022 were up 4% from the same time last year, but Lewis says, “Total operating expenses increased by 11% in the first six months of 2022 compared to the prior year. These higher expenses were driven by significantly increased costs for labor, energy, supplies and drugs.” You can find more details of the financial picture in the image below.
While these problems have plagued Washington hospitals, they are also national issues, like the nursing shortage, which has more traveling nurses working at rates that were up more than 40% and accounted for about 7% of total labor costs. Federal COVID aid ended last year, and the hospitals also face Medicare and Medicaid reimbursements that fall well short of actual costs, reaching about two-thirds of those costs in the best case. WSHA members say urban hospitals haven’t seen an increase in the Medicare and Medicaid reimbursement rates in 20 years. They also continue to care for a large number of patients that are ready for discharge but difficult to get through the process or to find skilled nursing or long-term care beds where they can be placed. Once they’re ready for discharge, those patients still cost the same to care for, only insurance companies won’t pay for that since that level of care is no longer needed.
When asked about union claims that hospitals created their staffing crisis with years of underpaying and overstaffing, administrators denied that was the case, saying they’ve tried to keep pace with market wages.
Bottom line, they say if the losses go on, available hospital care could be reduced, which could mean rural hospitals would struggle to find places for patients who need care for conditions better handled in larger hospitals, fewer beds or departments closed to stay afloat and, in the end, less care available for you.
