Report: Hospitals Face Mounting Financial Pressures
Tuesday, May 30, 2023
The mounting financial pressures hospitals in Arkansas are facing are part of a national trend affecting people's access to care, according to a recent report from the American Hospital Association.
It showed hospital expenses across the board saw double-digit increases in 2022 compared to pre-pandemic levels in such categories as workforce, drugs, medical supplies and equipment.
Aaron Wesolowski, vice president of policy research and analytics for the American Hospital Association, said more than half of hospitals started this year operating at a financial loss, and the trend is likely to continue this year and beyond. He added in the first few months of 2023, eight more rural hospitals had closed.
"The report found that after caring for more than 6 million patients hospitalized with COVID-19, and continuing to provide care for all patients during the pandemic," Wesolowski reported. "Hospitals are now facing new challenges in the form of rapidly rising costs as a result of workforce shortages and record inflation."
He added an inability to hire physicians also affects how many patients a hospital can admit. In November of last year, a Becker's Hospital CFO Report listed more than 630 rural hospitals at risk of closure by state, including 22 in Arkansas.
Wesolowski noted the report shows hospitals' overall expenses have increased by 17.5% between 2019 and 2022, far outpacing the Medicare reimbursement rates, which increased by only 7.5% during the same period.
"We would like to see Medicare rates keep up with the rate of inflation," Wesolowski urged. "And we'd like to see the federal agency that oversees the Medicare program, the Centers for Medicare and Medicaid Services, update and modernize the methods that they use to calculate those rates on an annual basis."
He added there are a number of proposals in Congress to further cut Medicare rates, which the association is working to oppose.
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