Washington state hospitals’ financial troubles expected to worsen

According to the Washington State Hospital Association, hospitals across the state suffered a net loss of nearly $929 million in the first three months of 2022.

WASHINGTON, U.S. — Washington State Hospital Association (WSHA) Chief Financial Officer Eric Lewis delivered an alarming message Thursday when he shared the results of a survey representing 97% of inpatient acute care beds across the state.

“It’s like nothing I’ve seen in my career and hospital leaders across the state are very concerned about it,” Lewis said.

According to Lewis, hospitals across the state suffered a net loss of nearly $929 million in the first three months of 2022.

With operating costs increasing 11%, Lewis says operating income increased just 5%.

Lewis described the losses as “unsustainable”.

As a result, WSHA CEO Cassie Sauer said beds and services will be reunited.

While most hospitals are nonprofit, Sauer said those hospitals still need some profit margin or reserves because they run the risk of not increasing wages and retaining staff or maintaining and updating medical equipment.

“Our concern is really the patients,” said Sauer. “It doesn’t work to keep running, 10% of expenses above income and at some point you have to cut benefits.”

According to Sauer, one of the main causes of financial losses is the high number of expensive patients who remain in hospitals for the long term when they have to be discharged for further care in long-term care facilities.

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For EvergreenHealth in Kirkland, the weekly financial loss for long-term patients is $1.3 million per week.

The hospital currently has more than 46 patients requiring long-term acute care, according to Mary Shepler, Chief Nursing Officer at EvergreenHealth.

“We spend a fortune on contract workers to staff rollaway beds,” Shepler said.

Any help hospitals have received from the federal government’s COVID-19 aid funds is now gone, according to Sauer.

“Federal relief funds didn’t cover the delta or the omicron waves,” Sauer said. “They were only granted at the beginning of the pandemic, so there was no federal relief for the highest surges that we had there.”

Other factors driving up hospital costs include Medicaid reimbursement, high inflation, and labor shortages, according to the WSHA.

WSHA executives said long-term solutions would require working with state legislatures.

During Thursday’s briefing, WSHA said the Medicaid reimbursement rate for hospitals had not increased in 20 years.

All 52 rural hospitals and health systems in Washington state reported negative margins, accounting for 99% of the statewide losses.

WSHA leaders said some hospitals may consider bankruptcy or closure due to the financial challenges. For communities with just one hospital, the closure would be critical, Sauer said.

https://www.king5.com/article/news/health/washington-hospitals-millions-financial-struggles/281-2becf70c-1099-4e2d-b1e4-a068d900f451 Washington state hospitals’ financial troubles expected to worsen

Alley Einstein

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