HHS Heeds Criticsm; Next Round of COVID-19 Funding will go to Hotspots, Rural Hospitals

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Hotspots and rural hospitals

Addressing concerns about funding for Covid-19 hotspots, HHS is carving out $10 billion for hospitals most affected by the virus. Hospitals in New York are expected to receive a large portion of this funding; New York City alone has seen 138,000 cases and 9,944 deaths attributed to Covid-19 as of Wednesday.“Hospitals have seen a 12% increase in costs related to Covid, but a 40% to 50 % reduction in revenue. Even the hospitals that are doing well, this has really rocked them back on their heels,” said David Mosley, a partner with Guidehouse. “Do I think (the funding) will make them whole financially? Probably not. … We’ve cancelled all these elective surgeries, but we still have all of the costs associated with those practitioners.”

The funding will factor in the number of admissions with a positive Covid-19 diagnosis since January. HHS also said it would take Disproportionate Share Hospital payments into account, which means hospitals that see patients who are uninsured or covered by Medicaid would get a portion of the funds.

Rural hospitals, which were financially vulnerable before the pandemic, will receive $10 billion based on their operating expenses. The cost of preparing for Covid-19 and cancelling elective procedures has hit these hospitals especially hard, with a recent report by Guidehouse estimating roughly a quarter of rural hospitals are at risk of closing. There are roughly 1,350 critical access hospitals across the U.S., which provide 24-hour emergency services and are several miles away from the nearest facility.


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