Minnesota Hospitals Forecast Nearly $3B Loss
Despite an uptick in care related to Covid-19, Minnesota’s hospitals are collectively losing $31 million in revenue each day, the state’s hospital trade group said late last week.
In an April 9 letter to the state’s congressional delegation, the Minnesota Hospital Association asked for help securing additional federal funds amid the Covid-19 pandemic. Over the next three months, state hospitals stand to lose about $2.9 billion total in revenue, according to modeling by Minneapolis accounting firm CliftonLarsonAllen LLP.
Association officials pin the revenue decline on reductions in other health services, along with the mounting costs of acquiring new protective equipment. Health systems are doing what they can to cut down on costs; Duluth-based Essentia Health, for instance, has put about 500 workers on unpaid administrative leave. But MHA officials say the cost-cutting measures aren’t enough.
“I am alarmed to say that the negative financial impact will be much worse than we originally anticipated,” wrote Dr. Rahul Koranne, MHA’s president and CEO, in the letter.
The association’s letter didn’t specify how much federal funding hospitals will need, though Koranne asked legislators to take “swift and urgent action to ensure emergency funds are immediately provided.”
The $2 trillion federal stimulus package passed by Congress last month does allocate $100 billion to the Public Health and Social Services Emergency Fund, which hospitals can tap into. However, Koranne maintains that “significant additional federal resources will be required.”
“We are grateful for the support that Congress has already provided, but I am sure you agree that additional support will be necessary and urgently so,” he wrote. “I am concerned about our ability to maintain Minnesota’s high-quality health care across all parts of Minnesota into the future.”