One of the biggest myths about hospitals is that hospital profits soared from pandemic relief payments. The fact is, hospitals did not get rich off the pandemic – quite the opposite happened.
The financial impact of the pandemic has been staggering for hospitals, and hospital profits have plummeted. Like most businesses, hospitals received significant COVID-19 relief funds to help weather the economic shutdown. But, those funds stopped flowing to hospitals in December 2021, and inflationary costs have only continued to rise. A 2022 Kaufman Hall report found almost half of Texas hospitals – 48% – are operating in the red, and nearly one out of every 10 is at risk of closure.
The Facts: Texas Hospitals Work to Stabilize Amid Harmful Mistruths
While COVID-19 relief funds and state-provided staff were extraordinary and necessary, that relief did not begin to cover the extra expenses borne by Texas hospitals. The report also found that hospitals experienced $3.2 billion in losses in 2022 – and more than $3 billion in unreimbursed costs since the beginning of the pandemic. Total expenses in 2022 for Texas hospitals were $33.2 billion higher than pre-pandemic levels, outpacing increases in revenue. And still today, workforce costs and inflation remain at record levels, with no further relief in sight.
Continuing to refute the narrative that hospitals got rich from the pandemic is crucial to keeping Texas hospitals’ doors open and ensuring access to critical, life-saving care across the state. To learn more about the challenges hospital faced during the 88th session of the Texas Legislature, read THA’s end-of-session report, Health Care and the 88th Texas Legislature: Outcomes for Texas Hospitals.
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