Hospital revenues rebound as patients come back

Hospitals' finances are climbing back toward pre-pandemic levels as patients come back — at least in outpatient settings.

The big picture: Volumes are still down compared to 2019, but the upticks in business since the start of the pandemic could be an indicator that consumer confidence is returning, said Erik Swanson, senior vice president of data and analytics at Kaufman Hall.

The big picture: "Under an optimistic scenario where vaccinations continue at a steady rate, we'll continue to see consumers come back to health care and not delay their care," Swanson said.

• Even under that scenario, hospitals' 2021 revenues would still be about $53 billion lower than revenues in the year before the pandemic. A more pessimistic scenario has hospitals losing $122 billion.
• But patients are coming back, and that means revenues will, too.

What they're saying: Community Health Systems CEO Tim Hingtgen said on an earnings call Thursday that his team has "a sense of optimism that as vaccination rates increase and COVID cases decline, we will continue to move to a more normal operating environment."

• "We’re pretty optimistic for the rest of the year," said John Ransom, managing director of health care equity research at Raymond James & Associates.
• With upwards of 80% of seniors vaccinated, "there is no reason they can’t go see their doctor and get that elective procedure done," he said.

But, but, but: Emergency department traffic continues to lag. Volumes remain down at both larger, publicly-traded hospital chains and smaller nonprofit health systems alike.

• Overall, the industry shows a 19.2% drop in ED volumes year-to-date. Post-pandemic, health system leaders have indicated in earnings calls that ED volumes could remain permanently lower.

"Many people have learned you don’t have to go to the ER for a black eye or stitches or that sort of thing," Ransom said.