A growing number of hospital operators across the country are in financial distress or have declared bankruptcy under the pressure of labor shortages and high inflation in the wake of the pandemic, WSJ Pro Bankruptcy reported. Small independent hospitals serving rural communities have been hit especially hard. More than 600, or about 30%, of all rural hospitals in the country are at risk of closing, according to the Center for Healthcare Quality and Payment Reform, a national policy center. As of August, 13 rural hospitals had shut their doors, exceeding seven and three in 2022 and 2021, respectively, according to the Cecil G. Sheps Center for Health Services Research, a unit of the University of North Carolina at Chapel Hill. Rural hospitals number about 1,800 out of roughly 6,100 total in the U.S., according to the American Hospital Association. As of August, eight hospital operators have filed for chapter 11, the highest number for the eight-month period since at least 2019, according to Gibbins Advisors, a healthcare restructuring advisory firm that keeps track of hospital filings with liabilities of more than $10 million. The sector’s troubles resurfaced after enhanced government funding during the COVID-19 pandemic dried up. Some hospitals are still on the hook to repay some of the pandemic aid, and consistently rising labor costs have been goaded by inflation, outpacing reimbursement increases. Read more.
The financially troubled healthcare sector will be the focus of the ABI Healthcare Program, September 18-19, 2023, in Nashville, Tenn. For more information and to register, click here.
