Illuminating the Impact of COVID-19 on hospitals and health systems: a comparative study of revenue and utilization

Illuminating the Impact of COVID-19 on hospitals and health systems: a comparative study of revenue and utilization

Collection:
Health Policy and Services Research
Series Title(s):
Brief (FAIR Health, Inc.)
Contributor(s):
FAIR Health, Inc., issuing body.
Publication:
New York, NY : FAIR Health, Inc., May 12, 2020
Language(s):
English
Format:
Text
Subject(s):
COVID-19 -- economics
Economics, Hospital -- statistics & numerical data
Pandemics -- economics
United States
Genre(s):
Technical Report
Abstract:
In response to the COVID-19 pandemic, hospitals and health systems have had to defer many elective procedures, both to free up resources and to limit the spread of the novel coronavirus that causes COVID-19. That deferral has been a financial strain on these facilities, as has a reduction in the number of patients seeking emergency care for non-COVID-19 reasons. To investigate the financial impact of COVID-19 on hospitals and health systems, FAIR Health compared estimated allowed amounts1 on private insurance claims submitted by facilities in the first quarter (January to March) of 2020, when COVID-19 emerged in the United States, with the first quarter of 2019 (adjusted by Consumer Price Index). FAIR Health also compared nationwide findings with those in the hardest-hit region, the Northeast. Analyzed as well were discharge volume, settings, and diagnoses and procedures. Among the findings: (1) In general, there was an association between larger facility size and greater impact from COVID-19. Nationally, in large facilities (over 250 beds), average per-facility revenues based on estimated allowed amounts declined from $4.5 million in the first quarter of 2019 to $4.2 million in the first quarter of 2020. The gap was less pronounced in midsize facilities (101 to 250 beds) and not evident in small facilities (100 beds or fewer). (2) March was the month in the first quarter of 2020 when COVID-19 had its greatest impact. A decrease in average per-facility revenues based on estimated allowed amounts in the first quarter of 2020 from the first quarter of 2019 did not occur until March. Nationally, in that month, in midsize facilities, the decrease was four percent; in large facilities, five percent. (3) Facilities in the Northeast experienced a greater impact from COVID-19 than those in the nation as a whole. For example, in the Northeast, the decline in average per-facility revenues based on estimated allowed amounts in March 2020 was sharper than nationally. In March 2020 in the Northeast, the decrease from March 2019 was five percent for midsize facilities, nine percent for large ones. (4) Nationally and in the Northeast, the third week of March 2020 was the week with the greatest declines in average per-facility revenues based on estimated allowed amounts from the corresponding week in 2019. In large facilities nationally, the decrease was 16 percent; in the Northeast, 26 percent. (5) In both the nation and the Northeast, the decrease in facility discharge volume from March 2019 to March 2020 was greater on a percentage basis than the decrease in revenues based on estimated allowed amounts. For example, in large facilities nationally, the drop in volume was 32 percent; in the Northeast, 40 percent. (6) Nationally, the decrease in facility discharge volume in the third week of March 2020 from the corresponding week in 2019 was greater than in any other week of the month. But in the Northeast, in midsize facilities, the fourth week of March had a greater drop (34 percent) than the third week (30 percent). (7) From March 2019 to March 2020, the outpatient share of the distribution of estimated allowed amounts by settings decreased relative to the inpatient share. The effect was more pronounced in the Northeast than nationally. In the Northeast, the outpatient share fell from 70 percent to 58 percent, while the inpatient share rose from 22 percent to 33 percent (with emergency room [ER] visits constituting the remainder in both cases). (8) The third and fourth weeks of March 2020, compared to the corresponding period in 2019, saw several changes in the most common diagnostic categories in the inpatient and ER settings. Nationally and in the Northeast, in the inpatient setting, diseases and disorders of the respiratory system rose in share of distribution by volume and estimated allowed dollars, while in the ER setting, acute respiratory diseases and infections rose.
Copyright:
Reproduced with permission of the copyright holder. Further use of the material is subject to CC BY-NC-ND license. (More information)
Extent:
1 online resource (1 PDF file (32 pages))
Illustrations:
Illustrations
NLM Unique ID:
101774916 (See catalog record)
Permanent Link:
http://resource.nlm.nih.gov/101774916