Hospital operating margins fell while expenses rose above budget expectations, according to the latest Kaufman Hall Flash Report.
Hospital revenues and volumes declined across most metrics during November but inpatient volumes increased as COVID-19 hospitalizations rose, according to the latest Kaufman Hall Flash Report released Monday morning.
For the first time this year, inpatient volumes eclipsed 2019 levels as patient days were up 4% in November, according to Kaufman Hall. Meanwhile, discharges fell 5.1% year-over-year and the average length of stay rose 8.7% over the same period.
Additionally, hospital operating margins fell while expenses rose above budget expectations, the study found. Kaufman Hall indicated that another surge in COVID-19 cases is leading to a "difficult winter ahead."
"U.S. hospitals and health systems will face untold challenges in the months ahead," Jim Blake, a managing director at Kaufman Hall, said in a statement. "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 timeโwe must support our nation's hospitals."
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In November, inpatient revenue and outpatient revenue declined 0.6% and 6%, year-to-date.
Meanwhile, another challenge arose for health systems: expenses.
Year-to-date, total expense per adjusted discharge rose 14%, labor expense per adjusted discharge rose 15.2%, and non-labor expense per adjusted discharge rose 14.2%.
Over the same period, drug expense per adjusted discharge increased 16%, and purchased service expense per adjusted discharge rose 20%.
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According to last month's Flash Report, adjusted discharges for October 2020 were down 9.3% compared to October 2019.
Kaufman Hall also found that the total expense per adjusted discharge rose 12.2% year-over-year.
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Jack O'Brien is the Content Team Lead and Finance Editor at HealthLeaders, an HCPro brand.