The Indiana Hospital Association says the COVD-19 pandemic is causing significant financial challenges for Hoosier hospitals and a combination of factors, including steep price increases by suppliers, is playing a role in the negative balance sheets.
The trade association says with the impact of increased costs of personal protective equipment, suspension of elective procedures, and patients avoiding care, hospitals are operating at a significant financial loss.
The IHA says Indiana hospitals experienced a negative operating margin of 8.3% for the month of April. The problems are even worse for rural hospitals, which the IHA reports an average negative operating margin of 27.7%
Hospitals have received federal stimulus and relief support, but the IHA estimates the money accounts for just 4% of hospitals’ annual net patient revenue.
“We hope that the federal government will act quickly to distribute the remaining dollars,” said Brian Tabor, IHA president. “We also hope that the State of Indiana will consider using some of its federal relief to establish a stabilization fund for rural and urban safety net hospitals, which remain especially vulnerable.”
IHA says hospitals struggled to acquire PPE, often paying highly inflated rates. It says some hospitals paid inflated prices for basic protective gear, including $7.00 per mask that had previously cost 37 cents each during peak scarcity.