Outpatient settings are experiencing the biggest fluctuations due to patients potentially delaying elective procedures.
Hospitals could experience a rise in patient volume in the coming months, especially on the outpatient side, after a decline in the summer.
Patient volume has been a barometer of the financial health of providers following the onset of the COVID-19 pandemic. Many of the largest for-profit hospitals reported encouraging admission totals in the second quarter of the year, which contributed to stabilizing operating margins.
July, however, brought a dip in patient volume and revenue as hospitals' financial performance worsened compared to previous months, according to Kaufman Hall's latest National Hospital Flash Report. Adjusted discharges per calendar day fell 7% month-over-month, with outpatient revenue per calendar day dropping 8%, compared to a 3% decline on the inpatient side.
At least on the outpatient side, the decrease in volume shouldn't come as much of a surprise, Janet Carbary, CFO at IRG Physical & Hand Therapy, told HealthLeaders.
"It's pretty typical on the outpatient side that it slows down," Carbary said. "We're very used to a summer dip because people go on vacation, they don't want to commit. We did see a little bit in July. We were blaming it maybe on the new COVID wave coming through, higher COVID numbers, and people are still reluctant to go into medical places if they have a high vulnerability to COVID. But it's not uncommon because staff and doctors all take vacations during the summer.
"I suspect we're going to see it bounce back up in September to pre-COVID numbers."
IRG may have already started to experience the autumn bump with record-setting volume for August, Carbary shared.
"We're a bit stunned by it ourselves," she said. "We have truly seen the first pre-COVID numbers. So we're excited about what we're seeing so far."
Carbary attributes the increase to demand rebounding after the pandemic kept patients away. Even with outpatient revenue per calendar day declining month-over-month in July, Kaufman Hall found it was still 9% higher year-over-year, 12% greater year-to-date compared to 2022, and a whopping 47% above 2020 levels.
"A lot of people delayed treatment until a time they felt comfortable to go get them," Carbary said. "People are just trying to get back to some sense of normalcy and they're not letting those things deter them or stop them like they were in the past."
With the current fiscal challenges, hospitals can improve their financial flexibility and stability by capitalizing on the shift to outpatient settings in a post-pandemic world. By implementing strategies to expand their outpatient footprint, rural health and critical access hospitals in particular may be able to keep their doors open.
Simply, hospitals that emphasize care transitions will be in a better position than those who don't. That could mean establishing relationships with local outpatient providers.
"I come out of the hospital environment and we don't do outpatient the same way freestanding outpatients do," Carbary said. "We're not as nimble and our systems aren't set up to accommodate, especially if you're a large acute care facility, you just don't do outpatients the same way and as efficiently as it can be done in an outpatient setting. So I see hospitals absolutely concentrating more on the outpatient side and the opportunity and the money to make it there, if they're efficient in how they do it."
Jay Asser is the contributing editor for strategy at HealthLeaders.
Kaufman Hall's National Hospital Flash Report for July revealed that revenue per calendar day fell by 8% month-over-month on the outpatient side and declined 3% for inpatient.
Janet Carbary, CFO at IRG Physical & Hand Therapy, told HealthLeaders that outpatient volume typically falls during the summer, but her facility experienced a significant bounce back in August.
Hospitals need to adjust their strategies to account for the shift to outpatient services with patients feeling more comfortable opting for procedures in the wake of the pandemic ending.