COVID-19 restrictions cost health care industry jobs and revenue
On March 19, Gov. Walz signed Executive Order 20-09, ordering health care providers to postpone elective surgeries and procedures, including non-emergency elective dental procedures. This is meant to free health care capacity and equipment for responding to COVID-19 cases and other emergencies.
Unfortunately, however, well-intended, this will have a considerable impact on the healthcare industry. According to the Star Tribune:
Fairview Health Services is one of the state’s largest nonprofit groups with more than 34,000 employees. Under the brand M Health Fairview, the health system operates 80 primary- and specialty-care clinics as well as nine hospitals including University of Minnesota Medical Center in Minneapolis and Fairview Southdale Hospital in Edina.
Last year, Fairview posted an operating loss of $215.9 million on revenue of $6.12 billion. The results were worse than 2019, when the health system saw a smaller loss of $96.2 million on about $6 billion of revenue.
The losses in 2020 came despite growth in Fairview’s specialty pharmacy business, Batson said, as well as its PreferredOne health plans. The health system also benefited from one-time factors.
While these losses had many causes, they were mainly due to the fact that government-mandated restrictions curtailed elective services, effectively reducing hospital and clinic volumes.
A COVID-19 surge last spring followed by a resurgence in November drove operating losses last year at Fairview Health Services as the Minneapolis-based health system saw patients delay care amid diminished demand for nonpandemic services.
Like other health care providers, Fairview curtailed nonemergency services to preserve resources for pandemic patients last year. Overall, patient registrations for outpatient services slipped by 21%, according to a financial statement released this week, while inpatient admissions were off by 11%.
The health sector lost 9 percent of its jobs between March and April 2020. By wiping away the demand for some health care services, COVID-19 restrictions cost Minnesotans jobs and providers’ revenue. Not only that, but the decline in screenings is expected to raise mortality for health issues like cancer.