While revenues fell by over 30%, expenses at Garden State hospitals rose more than 10%, according to a new report.
New Jersey hospital revenues have dropped $650 million per month due to the ongoing coronavirus disease 2019 (COVID-19) outbreak, according to a New Jersey Hospital Association (NJHA) report released Monday afternoon.
The analysis estimated that the pandemic caused the average Garden State hospital operating margin to drop from 4.3% at the start of the pandemic to negative 30%.
Additionally, while revenues fell by 32% per month, expenses at Garden State hospitals rose more than 10%, totaling $214 million per month. The report noted that these expenses do not include those "associated with hospitals’ expansion of bed capacity."
“COVID-19 is an unprecedented event for our healthcare system, and our hospitals have directed all of their resources at it, including extraordinary efforts to expand capacity that kept our state ahead of the curve,” NJHA President and CEO Cathy Bennett. “Unfortunately, that doesn’t come without risk to hospitals’ own fiscal health.”
In late March, Governor Phil Murphy issued an executive order to suspend most elective procedures at hospitals in New Jersey in order to handle the influx of patients infected with COVID-19.
Since that executive order was issued, hospitals across the state have seen volume declines for "non-COVID inpatient admissions, emergency room visits, outpatient procedures and laboratory, radiology and other diagnostic tests," according to the report.
New Jersey's 146,334 positive cases are the second-highest total for a state in the U.S., according to the Centers for Disease Control and Prevention.
Jack O'Brien is the Content Team Lead and Finance Editor at HealthLeaders, an HCPro brand.