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CHIA Publishes Report on Hospital and Health System Financial Performance with HFY 2020 Data

CHIA Publishes Report on Hospital and Health System Financial Performance with HFY 2020 Data

DATE: April 8, 2021

CHIA has published a preliminary update on hospital and health system financial performance for fiscal year 2020. This report provides a view of profitability, liquidity, and solvency for hospitals with a fiscal year end date of June 30 or September 30. Therefore this report only includes 49 of the 61 acute hospitals in Massachusetts, as well as data for 22 of the 25 hospital health systems.

This report explores the financial impact of COVID-19 on hospital health care operations during fiscal year 2020. Federal COVID-related funding was distributed in April, May, June, and July to hospitals as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. A portion of this funding was reported as operating revenue and is reflected in the data as such. State relief funds were also distributed to hospitals in this time period.  

Key Findings:

  • Overall acute hospital profitability in FY 2020, as measured by the median total margin, was 3.1%, a decrease of 0.4 percentage points in comparison to the prior fiscal year. These margins include $1.8 billion in COVID-19 relief funding reported as operating revenue.

 

  • Aggregate net patient service revenue, the most significant component of operating revenue, decreased by $1.4 billion (-5.6%), while aggregate expenses increased $1.3 billion (4.4%) in FY 2020 as compared to FY 2019.

     
  • Federal and state COVID-19 relief funds received by hospitals had significant impacts on their reported operating revenue and income. If these COVID-19 relief funds had not been distributed, all hospital cohorts would have experienced negative median total margins.

 

This publication includes a report with release notes and detailed data tables as well as a databook. To read future acute hospital and health system financial performance reports please visit https://www.chiamass.gov/hospital-financial-performance/.