As patient volumes fall and sources of revenue dry up, how can hospitals stay solvent?
For large health systems and community hospitals alike, cash flow might not present an existential crisis quite yet. But as COVID-19 efforts recently have absorbed much of their resources and some elective procedures have been put on hold for months now, there’s a real concern that lower patient volumes over the long haul will create a major financial crunch for a lot of them.
According to a Crowe analysis, except for New York and San Francisco, patient volume in U.S. health systems decreased by more than half between March 1 and April 15, producing a net revenue decline equivalent to more than $1.4 billion per day during that time span for all hospitals with more than 100 beds.
In a normal environment, hospitals that need a financial boost can explore adding or expanding service lines, concentrate on revenue collection, and look at opportunities on the cost-containment side. With uncertainty still surrounding COVID-19, changing service lines isn’t really an option for most hospitals right now, so the short-term focus likely will be on keeping expenses down and bringing in cash from existing services.