In 2020, COVID-19 undermined our nation’s health and severely tested our hospitals and health systems. At the same time that a series of spikes in COVID-19 cases and hospitalizations put intense pressure on hospital staff and resources, steep declines in non-COVID-19 volume led to sharply lower revenues.
A new Kaufman Hall analysis forecasts hospital revenue in 2021 – a critical criterion in determining the financial health of American hospitals. The analysis uses historical hospital revenues and different paths for three interconnected factors:
- Recovery of hospital volumes
- COVID-19 vaccine progress
- Decline in COVID-19 cases
The report presents two scenarios related to these factors – one more optimistic and one more pessimistic. Both scenarios are realistic, and both show a significant revenue loss compared with what would be expected absent the effect of COVID-19. The report also shows expense factors associated with COVID-19 likely to continue to pressure hospital finances as the pandemic continues.
This report was prepared at the request of the American Hospital Association.