USA hospitals are unprofitable so they are firing people

(written by lawrence krubner, however indented passages are often quotes). You can contact lawrence at: lawrence@krubner.com, or follow me on Twitter.

It’s clearly a terrible health care system if it has to shrink during a pandemic, because the pandemic is unprofitable:

Ho’s own experience illustrates how a pandemic can hurt business.

She delayed two big-ticket medical procedures scheduled for earlier this year — an MRI exam and a medically necessary contact lens, each procedure worth about $5,000 to health-care providers. She expects she will have both done in the coming weeks, illustrating how a backlog of medical procedures could help hospitals and doctors.

But Ho and other health economists see new constraints on how health care is delivered, reducing the efficiency and revenue in a sector that accounts for about 18 percent of spending in the $20-trillion-a-year U.S. economy.

…But the pandemic has been financially devastating for HealthPartners. It announced furloughs for 10 percent of staff — a number the provider bumped closer to 20 percent as tighter financial projections rolled in. Walsh’s pay was cut by 40 percent. Other top executives had their pay cut by up to 30 percent.

HealthPartners resumed some visits and procedures that were postponed by covid-19 preparations. Its dentistry operations remain mostly on hold, with just one of its 14 dental clinics open.

“The reduction in revenue is significant, and we’re not able to reduce costs to track with that exactly,” Walsh said.

…Admissions dropped by half in a roughly four-week period in April in comparison with the same time a year ago, Crawford said. Emergency-room visits also are down, by 54 percent, he added, and surgeries are down by about 80 percent. The hospital system, like many others facing tough financial decisions, has placed some staff members on leave, targeting those who had been working in parts of the health system now less in demand.

Source