Financial woes for the nation's hospitals are worsening as the coronavirus pandemic continues to surge.
The nation's hospitals, with flattened patient volumes because of the coronavirus pandemic, are projected to lose more than $20 billion a month for the rest of 2020, according to a new report today from the American Hospital Association.
According to the AHA report, Hospitals and health systems are reporting average inpatient volume declines of 19.5% and 34.5% in outpatient volume relative to 2019.
Many hospitals are reporting that they do not expect volumes to return to pre-pandemic levels for the rest of 2020.
"Hospitals and health systems are in the midst of the greatest financial crisis in our history, as we continue to fight this pandemic at the same time that non-COVID patient visits remain down,” AHA President and CEO Rick Pollack said in comments accompanying the report.
The federal government has already provided more than $170 billion in emergency funding for hospitals and health systems, but Pollack said that's not enough.
“While we appreciate the support to date from Congress and the Administration, this report clearly shows that we are not out of the woods. More action is needed urgently to support our nation’s hospitals and health systems and front-line staff,” he said.
As bad as the projected losses are, Pollack said the projections may still underrepresent the full damage inflicted on hospitals in 2020 because it does not account for the recent surge in COVID-19 cases in many parts of the country, and the potential for additional surges for the rest of the year.
Other expenses, such as increased acquisition costs for drugs and non-PPE supplies and equipment, are also not included in the AHA estimates. Nor do they include the long-term effects of the pandemic beyond 2020, AHA said.
Bayfront is one of several hospitals that CHS said it would sell as part of a years-long effort to shed about $1.6 billion in debt.
Debt-laden Community Health Systems, Inc. is selling its 480-bed Bayfront Health St. Petersburg to Orlando Health.
Financial terms were not disclosed.
Under a definitive agreement reached this week, Orlando Health will assume responsibility for the long-term lease and operations of the hospital. The lease transfer is subject to the consent of the St. Petersburg City Council, CHS said.
The deal is expected to close by September 30, subject to regulatory approvals.
For-profit, Franklin, Tennessee-based CHS Community Health Systems, Inc. owns, leases or operates 99 hospitals in 17 states, and after the sale of Bayfront St. Pete, the company will have 13 hospitals in Florida.
Private, not-for-profit Orlando Health is based in Orlando and operates six hospitals and a cancer center in south central Florida.
Bayfront was one of several hospitals that CHS said it would sell during the company's first quarter 2020 call as part of a years-long hospital sell-off to shed about $1.6 billion in debt.
CHS has been mired in debt since its ill-advised $7.6 billion acquisition of Florida-based hospital operator Health Management Associates, Inc. in 2014. CHS also shelled out $260 million in a settlement with the Department of Justice for alleged misconduct done by HMA prior to the acquisition.
CHS stock, which had traded for about $53 a share in 2015, was trading for $2.80 a share on Friday.
Trump claims "BIG VICTORY for patients." The plaintiffs, led by the American Hospital Association, will appeal the ruling.
A federal judge on Tuesday delivered a ringing victory for the Trump administration in a ruling that upheld a final rule mandating hospital price transparency.
"BIG VICTORY for patients – Federal court UPHOLDS hospital price transparency," President Donald J. Trump tweeted after U.S. District Judge Carl J. Nichols rejected an American Hospital Association-led attempt to strike down the final rule, which was issued last November.
"Patients deserve to know the price of care BEFORE they enter the hospital. Because of my action, they will. This may very well be bigger than healthcare itself. Congratulations America!," Trump tweeted.
The plaintiffs, American Hospital Association, and three other hospital associations, said they will appeal the ruling.
"We are disappointed in (Tuesday's) decision in favor of the administration's flawed proposal to mandate disclosure of privately negotiated rates," AHA General Counsel Melinda Hatton said.
"The proposal does nothing to help patients understand their out-of-pockets costs. It also imposes significant burdens on hospitals at a time when resources are stretched thin and need to be devoted to patient care," she said.
The final rule—which takes effect on January 1, 2021, one year later than initially proposed—requires hospitals to provide patients with easily accessible information about gross changes, payer-specific negotiated charges, discounted cash prices, and "deidentified" minimum and maximum negotiated charges.
The final rule also mandates that hospitals publicly display negotiated charges for 300 "shoppable services" on their websites in a consumer-friendly manner.
The plaintiffs—AHA, the Association of American Medical Colleges (AAMC), the Children's Hospital Association (CHA), and the Federation of American Hospitals (FAH), and three individual hospitals—had argued, among other things, that the final rule is "arbitrary and capricious," and that the requirement that hospitals publish negotiated rates with insurers violates the First Amendment and oversteps the government's legal authority.
Nichols, appointed to the federal bench in June 2019 by Trump, dismissed those claims.
He noted that the final rule is legal under provisions of section 2718(e) of the Public Health Service Act, which pertains to disclosure of "standard hospital charges"; section 2718(b)(3) of the PHS Act, which pertains to enforcement; and section 1102(a) of the Social Security Act, which gives the HHS secretary general authority to establish rules and regulations as necessary.
Ironically, the PHS Act provisions cited in the rules were amended by the Affordable Care Act, which the Trump administration argues should be invalidated in its entirety.
Nichols also rejected the plaintiffs' claims that disclosing negotiated rates could thwart their efforts to obtain more favorable contracts that would ultimately benefit consumers.
"The Rule requires only the publication of the final agreed-upon price—which is also provided to each patient in the insurance-provided explanation of benefits—and not any information about the negotiations themselves," he wrote.
"Plaintiffs are essentially attacking transparency measures generally, which are intended to enable consumers to make informed decisions," he wrote, "naturally, once consumers have certain information, their purchasing habits may change, and suppliers of items and services may have to adapt accordingly."
Hatton said Nichols' ruling was "premised on the erroneous conclusion that the 'standard charges' referenced in current law can be interpreted to include rates negotiated with third-party payers."
"While the Court ruled that this was a close call, that conclusion clearly does not reflect the experience of hospitals and health care systems. The AHA will appeal this decision and seek expedited review," she said.
The regulatory reductions are expected to save providers $6.6 billion and 42 million unnecessary burden hours through 2021, CMS said.
"The work of this new office will be targeted to help reduce unnecessary burden, increase efficiencies, continue administrative simplification, increase the use of health informatics, and improve the beneficiary experience," CMS Administrator Seema Verma said.
To determine where to trim red tape, CMS relied on input from 10 Requests for Information, along with listening sessions, site visits, feedback from more than 2,500 providers, clinicians, administrative staff, and beneficiaries, and 15,000 comments from various stakeholders.
Removed 235 data elements from 33 items on the Outcomes and Assessment Information Set assessment instrument for home health.
Established within the Quality Payment Program consolidated data submission for the Merit-based Incentive Payment System, removing a requirement that clinicians submit data in multiple systems.
Eliminated 79 measures under the Meaningful Measures Initiative, resulting in projected savings of $128 million and an anticipated reduction of 3.3 million burden hours through 2020.
Accelerated processing state requests to make program or benefit changes to their Medicaid programs through the state plan amendment and section 1915 waiver.
The Office of Burden Reduction and Health Informatics will also focus on creating efficiencies for health informatics, particularly as it relates to interoperability and leveraging new technology and automation to create new tools that allow patients to "own" their personal health data.
The emergency declaration is scheduled to expire on July 25, but hospitals say the status should be extended until key metrics are met.
The nation's hospitals are calling on the federal government to extend the coronavirus public health emergency that's set to expire next month, as providers in many parts of the nation grapple with COVID-19 hotspots and a recent sharp uptick in new cases.
"While not all areas of the country are seeing large numbers of COVID-19 patients, every hospital and health system is operating in a COVID-19 environment, requiring continued assistance from the federal government," American Hospital Association President and CEO Richard J. Pollack said in a letter to Health and Human Services Secretary Alex M. Azar.
"Remarkable progress in combating this pandemic continues to be made and now is not the time to pull back, but rather reinforce the need for a strong response from America’s hospitals and health systems as we work through the coming months," Pollack said.
No time frame was given for the extension of the emergency declaration, which Azar announced on January 31. Instead, Pollock offered four metrics that should be met before the emergency is lifted.
The supply chain is able to meet demand for personal protective equipment, lab testing supplies, and COVID-19 medications.
The number of lab tests administered nationwide exceeds 500,000 per day, and the number of COVID-19-positive tests is equal to or fewer than 5,000 per day for at least two weeks.
The number of patients in ICU beds nationwide is fewer than 5,000 per day for two weeks, and no more than 10% of those patients are in any one city or region.
The number of deaths per day from COVID-19 nationally is fewer than 500 for two weeks.
The AHA estimates that hospitals are losing about $50 billion a month, owing to the shutdown of elective and non-emergency services mandated by the pandemic.
Since the emergency was declared in January, the federal government has provided about $170 billion in relief for hospitals and other care providers during the pandemic.
"We are hopeful that one of the vaccine candidates currently in development will successfully complete all necessary trial phases," Pollack said. "However, until we reach that moment, our members, with your continued assistance and waiver flexibility, will remain ready and prepared to manage any future COVID-19 surges."
Compared with patients hospitalized in urban areas, the study found that the risk of death was 21% higher for patients hospitalized in small towns.
Survival rates for stroke victims in rural areas worsens significantly the farther they live from population centers, a new study showed.
Writing in the journal Stroke, Researchers at Washington University School of Medicine in St. Louis looked at data from more than 790,000 patients nationwide who were hospitalized for stroke from 2012 through 2017.
They found that overall, in-hospital mortality was about 6%.
Compared with patients hospitalized in urban areas, however, the study found that the risk of death was about 5% higher for patients hospitalized in large towns (with populations of 250,000 to 1 million people), 10% higher for patients in small towns (with populations of 50,000 to 250,000), 16% higher for patients in rural areas (with populations of 10,000 to 50,000) and 21% higher for patients in remote rural areas (with populations of less than 10,000).
The gaps did not improve over the five-year span of the study.
"Our data suggest rural patients are missing out on access to more advanced stroke therapies and that action is needed to address these disparities and ensure that people can get the care they need, no matter where they live," said senior author Karen Joynt Maddox, MD, an assistant professor of medicine at Washington University School of Medicine.
"In this day and age, it's unacceptable that people don't have access to advanced care. But since stroke therapy is complex, solutions are not going to be one-size-fits-all," she said. "We need to think fundamentally differently about how we deliver stroke care in rural areas to begin reducing these disparities."
Stroke is the fifth-leading cause of death in the United States, with 140,000 deaths annually, according to the Centers for Disease Control and Prevention.
In more rural areas, the investigators also found that patients were less likely to receive either of two advanced stroke treatments: intravenous thrombolysis; and endovascular therapy.
"It's not realistic to expect small, rural hospitals to perform some of the more advanced procedures, such as endovascular therapy," Joynt Maddox said. "But they can recognize when patients need more advanced care and transfer patients to a hospital that has those capabilities."
"One problem is that health systems don't have consistent, widespread procedures in place to make sure that stroke patients in rural areas have access to these technologies when they need them," she said.
Making matters worse for rural patients is the time factor. Clot-busting drugs must be administered within the first three hours after the onset of symptoms, and endovascular therapy must be given within six to eight hours after symptoms appear. After these time points, the risks of the procedures, especially internal bleeding, begin to outweigh the benefits.
The study didn’t assess the time lapse between the onset of symptoms and the first treatments being administered, but they believe rural patients may live or work farther from hospitals and have to wait longer for emergency services to respond to a 911 call than patients in urban areas.
The announcement comes three weeks after Michigan-based Beaumont and Ohio's Summa Health called off their merger.
Beaumont Health and Advocate Aurora Health announced Wednesday that they're "exploring a potential partnership" to create one of the largest health systems in the nation with a footprint three states.
If finalized, the merged system would include 35 hospitals, more than 650 care venues, 108,000 employees and $17 billion in annual revenues, with a presence in Michigan, Wisconsin, and Illinois.
Beaumont and Advocate Aurora began merger talks at the end of 2019, but were interrupted during the COVID-19 surge.
"Our discussions were paused by COVID-19, but in no way are they caused by COVID-19," Beaumont CEO John Fox said. "This announcement would have come sooner if we had not gone through the pandemic."
In January 2020, Summa signed a definitive agreement to join Beaumont, but that deal was called off in late April. In a teleconference with reporters on Wednesday, Fox called the simultaneous negotiations with Summa and Advocate Aurora "two unrelated items."
"Both Summa Health and Advocate Aurora emerged in the middle of 2019 as a conversation. Advocate Aurora was fine with Beaumont Health going forward with Summa, and fine if we elected not to do that," Fox said.
"The reason we did not go forward with Summa has nothing to do with Advocate Aurora," Fox said. "We were working with Summa on some changes we needed to make to the agreement between us, particularly related to the pandemic, and the financial realities around the pandemic."
"Ultimately, we could not come to agreement on those and we elected to not proceed with the transaction. The Summa people are great people, but again, this was totally independent of the Advocate Aurora conversation," he said.
Summa Health declined to comment when contacted by HealthLeaders and referred questions to Beaumont Health.
The proposed merger of Advocate Aurora and Beaumont would create equal one-third governance representation of any future partnership between Beaumont and legacy Advocate Health Care and Aurora Health Care organizations.
The health systems notified attorneys general in Michigan, Illinois, and Wisconsin about their merger talks last week, and pledged to work with state regulators through the process, which Fox said they hope to complete by the end of the year.
Jim Skogsbergh, CEO of Downers Grove, Illinois-based Advocate Aurora, said the merger provides a "unique opportunity to explore a partnership with a like-minded, purpose-driven organization."
Concerns have been raised that fear of coronavirus contagion has led patients to delay essential and even emergency care.
Even as coronavirus cases are trending up in many parts of the nation, the Trump Administration is encouraging healthcare facilities to reopen for non-emergency and elective care, and the Centers for Medicare & Medicaid Services is showing them how to do it.
"Americans need their healthcare and our healthcare heroes are working overtime to deliver it safely," CMS Administrator Seema Verma said. "Those needing operations, vaccinations, procedures, preventive care, or evaluation for chronic conditions should feel confident seeking in-person care when recommended by their provider."
Elective services came to a grinding halt in late March after health systems and other care venues attempted to slow the spread of the coronavirus.
The shutdown has left many providers in perilous financial shape, despite more than $175 billion in emergency stopgap funding provided by the federal government.
Concerns have also been raised that fear of contagion has led patients to delay critically needed and emergency care, along with routine maintenance visits at physicians' offices. CMS has released a guide for patients considering their in-person care options.
The Washington Post is reporting that, since the start of June, 14 states, including Texas, California, Florida, and Puerto Rico have recorded their highest-ever seven-day average of new coronavirus cases since the pandemic began. However, some have speculated that the increase in the numbers of reported coronavirus cases is owing more to improved testing.
On April 19, CMS issued Phase 1 recommendations to safely resume in-person care in areas with low incidence or relatively low and stable incidence of COVID-19 cases.
CMS has also offered recommendations for providers of in-person care that cover patient- and provider-safety issues, including facility considerations, testing and sanitation protocols, personal protective equipment and supplies, and workforce availability.
Ultimately, CMS says the decisions to reopen should be in line with federal, state, and local orders, Centers for Disease Control and Prevention guidance, and in collaboration with state and local public health authorities.
Another $10 billion is expected to be released soon to aid hospitals providing care in COVID-19 "hotspots."
The Department of Health and Human Services has released another $10 billion from the Provider Relief Fund, with this latest emergency package targeting safety net hospitals.
"Healthcare providers who focus on treating the most vulnerable Americans, including low-income and minority patients, are absolutely essential to our fight against COVID-19," HHS Secretary Alex Azar said in a media release.
Under the eligibility guidelines, the money is earmarked for hospitals with Medicare disproportionate payments of 20.2% or higher, with uncompensated care costs of $25,000 per bed over one year, and profit margins of 3% or less in their most recently filed Cost Report, HHS said.
Payments, which will range from $5 million to $50 million, are being sent directly to the safety net hospitals.
To date, HHS has provided more than $175 billion to aid appropriated under the Coronavirus Aid, Relief, and Economic Security (CARES) Act and the Paycheck Protection Program and Health Care Enhancement Act, to hospitals and other providers disproportionately affected by the pandemic.
HHS on Monday reminded hospitals that another $10 billion in emergency funding for hospitals serving in COVID-19 "hotspots" would soon be made available, but that hospitals would have to update their COVID-19 positive-inpatient admissions data from January 1 through June 10 to determine eligibility. Hospitals have until 9 PM ET on June 15 to update their records.
The news of additional funding was greeting with hearty cheers from hospital stakeholders.
"Today’s announcement of $10 billion in additional funding for hospitals that provide safety-net care, as well as a future allocation of $10 billion for providers in COVID-19 hot spots, will help ease the financial pain this public health emergency has inflicted on these caregivers," said Bruce Siegel, MD, president and CEO of America's Essential Hospitals.
"We appreciate that the administration has recognized the severe pressures on front-line providers," he said.
Rick Pollack, president and CEO of the American Hospital Association, said his association was "pleased" with the new money, but suggested that more emergency funding may be needed.
"While we appreciate the emergency funds released by HHS to date, the AHA continues to urge the department to distribute substantial additional funds to hospitals and health systems in an expedited manner as the COVID-19 virus continues to spread, hospitalizations continue to occur, and many Americans continue to forgo care, including primary care and other specialty care visits," Pollack said.
$15B for Medicaid and CHIP
Elsewhere, the Health Resources and Services Administration is distributing $15 billion from the Provider Relief Fund to Medicaid and Children's Health Insurance Program providers.
HHS said this latest round of funding will focus on Medicaid and CHIP providers who have not received money from the Provider Relief Fund General Allocation.
Stuczynski has been with Memorial since 2005, most recently as CFO of Memorial Regional Hospital South in Hollywood.
Veteran healthcare executive Joe Stuczynski has been named CEO of Memorial Hospital Pembroke, a 301-bed community hospital in Pembroke Pines, Florida, Memorial Healthcare System announced Friday.
Stuczynski has been with Memorial since 2005, most recently as CFO of Memorial Regional Hospital South in Hollywood, Florida, and served as CFO of Memorial Hospital Pembroke from 2005 to 2015.
"It is an honor to return to Memorial Hospital Pembroke and be given the opportunity to collaborate with a team of skilled health professionals who are leading the way through innovation and high-quality service," Stuczynski said in a media release.
Stuczynski has more than 25 years of administrative experience in large integrated healthcare organizations with almost two decades at the executive level.
As CFO of Memorial Regional Hospital South, he was responsible for the Rehabilitation Institute, Memorial Manor Nursing Home and Home Health Services. Previously, he served as CFO for Memorial Hospital Pembroke, where he also had responsibility for a number of operational departments.
The six-hospital Memorial Healthcare System includes Memorial Regional Hospital, Memorial Regional Hospital South, Joe DiMaggio Children's Hospital, Joe DiMaggio Children's Health Specialty Center in Wellington, Memorial Hospital West, Memorial Hospital Pembroke, Memorial Hospital Miramar, and Memorial Manor nursing home.
