AHA Reports on COVID-19 Financial Impact

May 5, 2020

Today the American Hospital Association (AHA) released a new report—Hospitals and Health Systems Face Unprecedented Financial Pressures Due to COVID-19—confirming the tremendous financial strain that hospitals and health systems on the front lines in the fight against COVID-19 are under. AHA estimates a total financial impact of $202.6 billion in losses resulting from COVID-19 expenses and lost revenue for hospitals and health systems over the four-month period from March 1, 2020 to June 30, 2020 – or an average of over $50 billion in losses a month.

For this report, the total financial impact on hospitals and health systems includes the costs of COVID-19 hospitalizations, the impact of canceled and foregone services due to COVID-19 on hospital revenue, the additional costs associated with purchasing needed personal protective equipment, and the costs of additional support some hospitals are providing to their workers. For example, some hospitals are providing child care, housing and transportation for their front line caregivers and other employees.

The financial impact estimates in this report do not include other important costs borne by hospitals, such as the increases in drug and labor costs that have resulted from the pandemic. The extent of these increases on hospitals will be better understood as more data becomes available. AHA says it is also important to understand that the report estimates costs through June 30, 2020, and it remains to be seen how quickly life will return to normal across the country in the months to come. Hospitals will likely continue to see lower service use while treating COVID-19 patients beyond June 30, which would result in continued financial pressures.

“America’s hospitals and health systems have stepped up in heroic and unprecedented ways to meet the challenges caused by COVID-19. However, the fight against this virus has created the greatest financial crisis in history for hospitals and health systems,” said Rick Pollack, AHA president and CEO. “While we appreciate the support and resources from Congress and the Administration, many hospitals are still on the brink. We need further support and resources to ensure that we can continue to deliver the critical care that our patients and communities are depending on while also ensuring that we are prepared for the continuing challenges we face from this pandemic as well as other potential emergencies.”