Oregon hospitals finish 2022 in the red, see no end in sight for losses, seek lawmakers’ help
Ask lawmakers to pass bills to help rebuild workforce, take other steps
LAKE OSWEGO, Ore. (KTVZ) -- Rising expenses, workforce shortages and stalled revenue cratered Oregon hospitals’ operating margins in 2022, putting hospitals in one of the worst overall financial positions seen since 1993, according to a report prepared for the state's hospital association.
Expenses have outpaced revenues for more than two years, or nine consecutive quarters. Hospitals’ median operating margin, which includes federal CARES Act funding, declined to -2.8% in 2022, compared to 3.2% in 2021 and 4.1% in 2020. The data is part of a new Apprise Health Insights report on calendar year 2022 financial results. The full report is attached.
“After two years of losses, hospitals are facing extraordinarily difficult choices,” said Becky Hultberg, president and CEO of the Oregon Association of Hospitals and Health Systems. “Organizations will struggle to remain sustainable in this type of environment.”
Rising expenses, especially labor, negatively impacted hospitals all year long. Labor expenses per FTE increased 26% over pre-pandemic levels. The health care workforce shortage contributed to rising labor costs. Meanwhile, total operating expenses rose 11% compared to 2021, exceeding net patient revenue (which also increased, but only by 5.8%) by $1.6 billion.
At the same time, the inability to safely discharge patients to other settings continued to plague hospitals in 2022. Average length of stay (ALOS) was up 20%, and those longer stays often came with no additional reimbursement to pay for staff and other services necessary to care for those patient needs.
Apprise Health Insights data show throughout 2022, between 600 and 700 patients statewide were either “boarding” or unable to be discharged, continuing to cause strain on hospitals and families focused on placing patients in the best care setting.
Amid these persistently poor financial conditions, OAHHS has proposed a package of bills in the 2023 legislature that will help rebuild the health care workforce, exempt certain labor costs from the state’s cost-growth target and create a task force to explore ways to increase capacity in care settings outside of hospitals.
“These record losses should create a sense of urgency for legislators to act,” said Hultberg. “Economists are predicting 2023 will also be a difficult year for hospitals. We can’t sit back and do nothing, waiting for things to improve.”
###
About OAHHS: Founded in 1934, the Oregon Association of Hospitals and Health Systems (OAHHS) is a mission-driven, nonprofit trade association representing Oregon’s 62 hospitals. Together, hospitals are the sixth largest private employer statewide, employing more than 70,000 employees.
Committed to fostering a stronger, safer Oregon with equitable access to quality health care, OAHHS provides services to Oregon’s hospitals ensuring all are able to deliver dependable, comprehensive health care to their communities; educates government officials and the public on the state’s health landscape and works collaboratively with policymakers, community based organizations and the health care community to build consensus on and advance health care policy benefiting the state’s 4 million residents.
About Apprise: Apprise Health Insights is the most reliable and complete source of hospital data in Oregon. As the data subsidiary of the Oregon Association of Hospitals and Health Systems (OAHHS), Apprise staff have gathered and analyzed data about Oregon hospitals and health systems since 1985. We strive to provide data, tools, and expertise to help hospitals understand the healthcare landscape in the Pacific Northwest.
