2020 was a rough year for hospitals and health systems as pandemic restrictions forced short-term service line closures and longer lasting deferrals of elective care. The disruptions led to flat or declining operating revenues across provider organizations large and small, all while expenses mounted and bottom lines suffered.
Going into 2021, the uncertainty of the pandemic left the industry worried these revenue declines would continue.
In forecasts published near the top of the year, industry analyst Kaufman Hall predicted hospitals would see anywhere from $53 billion to $122 billion in total revenue losses across the year.
The determining factors, they wrote, would be the return of volumes to pre-pandemic levels, the speed with which vaccines would be distributed across the country and whether COVID-19 cases would decline or return in cyclical surges.
Reality showed 2021 to be a year of ups and downs in both the pandemic response and the healthcare industry’s financial well-being.
Volumes came back to hospitals, but not quite to the extent of 2019 across most markets, Kaufman Hall wrote a year later. Rapid initial uptake of COVID-19 vaccines stalled out by the summer, leading to delta and early omicron waves that primarily hospitalized the unvaccinated and, again, drove up patient acuity and threatened operations in the hardest-hit regions.
Yet despite those challenges, increased revenues were a bright spot for the industry. Per Kaufman Hall, hospitals’ gross operating revenue for 2021 was up 14.7% compared to 2020 and 12.1% compared to 2019.