Hospitals are increasing: 3 statistics to find out

While hospitals are preparing to increase the costs linked to the prices offered by President Donald Trump, a new report by the American Hospital Association reveals that drugs and supplies are only part of the problem.

Overall, hospital expenses climb regularly-pulled by the chronic payers’ sub-paids, increasing administrative requirements and the increase in labor costs. Below is three key details of the AHA report.

Medicare and Medicaid sub-paids total hundreds of billions of dollars a year.

Care provision becomes more expensive for hospitals as the American population is aging and more patients encounter serious health problems. This challenge is exacerbated by the fact that an increasing number of these patients are provided by Medicare or Medicaid – who generally pay less hospitals than what it really costs to treat someone.

In 2022 Medicare and Medicaid paid $ 130 billion less than that it cost to provide care. Medicare has only reimbursed 82 cents hospitals for each dollar spent on patient care, resulting in a loss of $ 100 billion just medicare, according to the report.

Over time, these shortcomings have added. In the second half of the 2010s, Medicare and Medicaid sub -paids reached more than $ 500 billion, 40% more than in the first half of the decade – even after taking inflation into account.

Hospitals are not reimbursed for the tens of billions of dollars they spend each year to fight against unjustified refusals.

Hospitals are faced with the increase in administrative costs largely due to restrictive practices of commercial insurers, including Medicare Advantage and Medicaid Managed Care Plans. While the premiums increased twice as quickly as hospitals in 2023, commercial insurers added constraints thanks to automated refusals and excessive prior authorization requests.

Researchers estimate that hospitals spend 10 billion dollars per year only to manage previous authorizations, as well as 20 other billions of dollars in complaints – more than half of which are care that should have been approved in the first place, according to the report.

In 2023, the refusals of the MA plan jumped almost 56%, many of which found themselves overturned later. But even when the coverage refusals are canceled, hospitals are not reimbursed for the time and the cost spent fighting them.

Maintenance costs represent 60% of total hospitals.

Salaries and benefits for hospital workers have increased much faster than general inflation in the last decade, according to the report.

Hospital labor costs have increased by more than $ 42.5 billion from 2021 to 2023, reaching $ 839 billion, or almost 60% of total hospitals. In 2023 alone, hospitals spent $ 51.1 billion for costly contract staff to cover labor shortages, especially in rural areas.

Contractual labor expenditure has decreased from the pandemic peak, but it remains high and continues to reduce the budgets of the hospital. It is also important to remember that labor costs are very sensitive to staff shortages, noted the report.

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