The COVID-19 pandemic caused a surge in hospital patient volume and legislation in response to the pandemic sent Medicaid enrollment through the roof. With the public health emergency officially ended, things in the healthcare industry are starting to shift back to normal, including declining patient volumes as a result. With the pandemic behind us, Medicaid eligibility was brought into question and redetermination changes are already taking effect, with many losing their eligibility as a result. This in combination with already declining volumes has left hospitals in a state of decreasing volume and increasing bad debt, hence the poor financial performance in recent months.
Hospitals caught in this tough financial situation are wondering how to make it up and despite decreasing volume allowing for reduced expenses, the savings are not enough to offset the revenue losses. Hospitals have also found difficulty in transitioning patients to long term care as a result of a lack of space in such facilities, causing prolonged stays and rising costs.
As the changing financial landscape is here to stay, it is important for hospital operators to adapt and adjust in order to remain competitive. Hospitals will need to take a hard look at existing processes to implement changes worth the time commitment, including establishing transition processes that are clear and get the job done.