The Texas Hospital Association (THA) released a new report on Thursday that shows the COVID-19 pandemic has taken a profound financial toll on the state’s hospitals.
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Hospital operating margins were 24.1% below 2019 pre-pandemic levels with nearly half of hospitals reporting negative margins in 2022.
Higher expenses and lower hospital volumes are threatening financial viability with nearly 1 in 10 hospitals at serious risk closure and 26% of rural hospitals at financial risk. Expenses are up 20% over pre-pandemic levels due to increases in labor, medical supply, and drug costs.
Also straining resources are the seasonal surges in hospitalizations from respiratory-related illnesses as health systems anticipate a potential “tripledemic” on the horizon. According to the US Department of Health and Human Services, the nation’s pediatric hospital beds are at 91% capacity this week from cases of RSV among children.
“Extreme pressure on life-saving hospitals creates risk for patients and the state’s overall health,” said John Hawkins, President and CEO of THA. “Hospitals are critical infrastructure for communities and serve as a backbone for health, safety, jobs and stability.”
THA estimates that hospitals, even with federal support, have incurred more than $3.2 billion in losses to date since the pandemic began.
As the 2023 legislative session approaches, THA is calling for more state support to keep hospitals viable, including broader healthcare coverage for Texans and workforce growth promotion in critical positions.
Texas currently has the fourth worst nurse-to-population ratio at 9.25 registered nurses per 1,000 residents, a gap that is expected to reach 36,000 by 2025 and 60,000 by 2032.
THA wants to see an increase to state funding for community-based behavioral health services and support, Medicaid supplemental payments for unreimbursed costs, and public health data collection.
At the federal level, THA is advocating against Medicare cuts and a Statutory PAYGO sequester from taking effect.
THA says without more resources toward operational and financial stability, the state’s patient care and healthcare access in the face of ongoing respiratory illness surges will be compromised.