June 2020
National Hospital Flash Report
Based on May Data from Over 800 Hospitals
scroll_down.svg
mail.svg
Share the report
Real Data. Real Insight. Real Time.
Dear Readers,
Hospitals and health systems across this country have been nothing short of heroic in their efforts to battle COVID-19. In addition to the immense clinical challenges, the pandemic has had devastating financial implications, plunging already-thin hospital operating margins to historic lows in March and April. Now, May performance results reflect early indications of a potential recovery.
Aided by a partial reemergence of patient volumes—including a sizable jump in surgery volumes compared to low levels seen in April—and an infusion of federal funding, most hospitals saw significant margin improvements from April to May. More than $50 billion in funding from the CARES Act helped temporarily push the median hospital Operating Margin back out of the red, to 4% in May. Without the funding, it would have been –8% for the month, which still is greatly improved from April and slightly improved from March, suggesting some recovery.
Despite the month-over-month gains, however, hospital margins and volumes remained well below 2019 performance and budget expectations. Even though the year-over-year declines were far less than those seen in April, they convey the continued fragile state of our nation’s hospitals.
Current circumstances bring to mind a quote from Winston Churchill. In 1941, in the midst of WWII, he said: “We shall not fail or falter. We shall not weaken or tire. Neither the sudden shock of battle nor the long-drawn trials of vigilance and exertion will wear us down. Give us the tools, and we will finish the job.”
While the May results offer signs of hope, they also serve as a reminder of the long road ahead. This pandemic is far from over, and the road to recovery likely will not be a consistent upward slope, but rather a series of peaks and valleys. Different organizations will move at different speeds along divergent paths depending on numerous factors, such as available resources, fluctuations in coronavirus cases, consumer sentiment, and additional aid.
Healthcare leaders nationwide must continue to closely monitor performance data to help gauge the overall health of the industry, and their organizations’ role in an evolving environment. They must act quickly to rigorously assess their organizations’ positioning and strategic options, and to chart the path forward. Only by acting now do healthcare leaders stand the best chance of giving their organizations the tools needed to finish the job.
Thank you.

Jim Blake Managing Director and Publisher
Kaufman Hall
See Kaufman Hall’s Coronavirus page for regular updates.
©2020 Kaufman, Hall & Associates, LLC
scroll_up.svg
kha_logo.svg
National Hospital Flash Report
menu_icon.svg
Sign up now for access to the latest news and reports
SUBMIT
Become a subscriber
Receive our monthly reports
Your details
Become a subscriber
Receive our monthly reports
Your details
Become a subscriber
Receive our monthly reports
Your details