HARTFORD, CT — A recent report from the Office of Health Strategy (OHS) shed light on the mounting financial issues faced by Connecticut’s acute care hospitals, underscoring the urgent need for reform.
Diving deep into the financial health of the state’s hospitals in the fiscal year 2022, the OHS revealed startling findings. Statewide, hospitals experienced a loss of $206.6 million from patient care and related sources, in sharp contrast to a gain of $333 million the previous year. While net patient revenue increased by over $2 billion since FY 2019, the surge was met with expenses rocketing from $12.5 billion to $15.8 billion, resulting in a sizable operating loss.
In an unsettling revelation, only 48% of hospitals in the state managed to achieve a positive total margin. The statewide total margin saw a plummet to -3.36% in FY 2022, a stark decline from 9.17% the previous year. The report also pointed out that six hospitals reported negative five-year average total margins, which is two more than the previous period.
These challenges are further magnified with hospitals incurring a $907 million bill for uncompensated care in FY 2022, marking an 8.8% rise from the prior year. Furthermore, charity care and bad debt costs surged by 9.6% in just a year.
Adding to the financial strain is the inadequacy of government reimbursements. The OHS highlighted that Medicare payments averaged only 74 cents on the dollar, while Medicaid’s reimbursement stood at a mere 62 cents in FY 2022.
“This report direct from OHS confirms the significance of the financial challenges facing hospitals and health systems today,” Connecticut Hospital Association CEO Jennifer Jackson said. “Hospitals provided exceptional, compassionate care to all patients through the pandemic and continue to provide high-quality care to every patient who walks through their doors, regardless of ability to pay. But there are lasting and unprecedented financial challenges that they are navigating every day that cannot be ignored.”
Jackson further emphasized the need for policy revision to ensure continued access to quality healthcare.
“We urge OHS and our state partners to focus on this report and recognize the apparent reality as we work together to develop policies that continue enhancing healthcare access and affordability throughout our state,” Jackson said.
But officials don’t necessarily have a firm answer yet.
“I think you’ll find the revenue to our hospitals is as volatile as captial gains,” Gov. Ned Lamont said Friday.
The exhaustive report encompasses both statewide trends and individual hospital profiles, aiming to provide a holistic understanding of the financial landscape of Connecticut’s healthcare system.