One state’s hospitals saw $650M drop in revenue, with radiology cancellations a key factor

Monthly New Jersey hospital revenues dropped roughly $650 million, or 32%, with decreases in radiology and other services a key driver of the downturn.

The Garden State’s hospital association recently made this discovery after polling local acute care hospitals to gauge their financial struggles in March and April. New Jersey providers have been beset by a double whammy of financial challenges during the pandemic, with hospital expenses also increasing by $214 million per month.

This uptick was driven by several factors, the association noted, including increased spending on personal protective equipment and additional overtime hours. New Jersey certainly isn’t alone. One analysis, updated on Monday, estimated that hospitals across the country are losing $60 billion each month, while 55% fewer Americans sought care.

“N.J. hospitals are reporting significant declines in several key areas,” Sean Hopkins, senior vice president of the New Jersey Hospital Association’s Center for Health Analytics, Research and Transformation, said in a statement. “Hospital volume is down for non-COVID inpatient admissions, emergency room visits, outpatient procedures and laboratory, radiology and other diagnostic tests," he added.  

The association traced the downturn back to Gov. Phil Murphy (D) issuing an executive order on March 23, suspending most elective surgeries and procedures. Since then, statewide hospital operating margins have plummeted by about 30%. However, the governor lifted the order on Friday, which has association leadership hopeful that imaging and other service volumes will begin to rebound with the relaunch set for May 26. 

"We respect the governor's approach to a responsible reopening, including his 'data determines dates' litmus test. We agree—and the data shows that it's time for hospitals to fully reopen their doors to people awaiting care,” NJHA President and CEO Cathy Bennett said in separate statement. Even amid the shutdown, New Jersey hospitals still treated more than 350,000 non-COVID patients during that time period.