Hospitals say they are in tough shape amid workforce crisis as COVID-19 relief dries up
HOspitals are in financial trouble as billions of dollars in COVID-19 relief funds dry up. This is because a growing healthcare workforce shortage threatens their bottom line.
According to Kaufman Hall’s report, hospitals were unable to receive $175 billion in federal subsidies in order to remain afloat during COVID-19. They also reported their worst financial results since 2022 when growth in costs, such as labor, outpaced revenue.
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“This has been an ongoing challenge, really, through the pandemic, before the pandemic, and now as we are sort of coming out of the pandemic, it is a real struggle for hospitals and healthcare, one, to get the workforce that they need and then to continue to pay for [it],” Lisa Kidder Hrobsky was the senior vice president for advocacy at the American Hospital Association. “Workforce is a massive part of hospitals expenses, and so it is more expensive than ever to pay for workforce when you can find workforce.”
According to data from the Association of American Medical Colleges, the United States will see a shortage of as many as 124,000 doctors by 2034. This includes 48,000 primary care physicians. Although the looming shortage in healthcare workers has been a problem for many years, hospitals claim they are now having to pay their current staff more to keep them.
Dr. Don Williamson is the president of Alabama Hospital Association. He stated that in 2022, state hospitals had a $1.5 billion decrease in income. This decline was due to an increase of nearly $1.4 trillion in labor costs. Williamson said that Alabama hospitals would have had their income drop by $2.4 billion if they did not receive federal funding.
“We have not seen a corresponding increase in revenue to keep up with our increased expenses,” Williamson stated.
Bipartisan attention has been paid to the shortage in healthcare workers, although some lawmakers are cautious about putting more money after major pandemic-era investments.
In 2020, the Coronavirus Aid, Relief and Economic Security Act (or CARES Act) included $100 billion for a Provider Relief Fund. This fund was to assist healthcare providers in recovering COVID-19 revenue. It could also be used to help healthcare systems recruit and retain staff. To improve the well-being and retention of healthcare workers, the Biden administration allocated $103 million to the American Rescue Plan 2021.
Critics believe that hospitals do not have a complete picture about their finances.
“They’re giving this dire picture of their economic situation and some of them are publicly traded or have to submit their public earnings reports that just don’t at all match up with that. Some of them are expanding, actually, many of them are just constantly expanding and making new capital expenditures,” James Gelfand, president and CEO of the ERISA Industry Committee lobbies for large self-insured employers.
North Carolina’s top hospital executives have made more than $1.75 Billion over the last twelve years. Their salaries almost doubled in the last five year, while the state treasurer’s Office released a report showing that nurse and physician pay has risen much slower in that time.
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“When somebody cries about not having enough money to pay their nurses, it’s because, generally speaking, when the nurse pay has basically stayed stagnant for the last five years in many instances, the CEO pay’s double,” Dale Folwell is the North Carolina State Treasurer. “I don’t know of any more mathematical example of putting profits over patients than that.”
Sens. Spitzer of the Health, Education, Labor and Pensions Committee sought input from stakeholders and healthcare providers nationwide to understand the causes and suggest ways to address them. Sens. Senators. “identify bipartisan solutions” This will help to solve the problem.
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