Several hospitals said they may not make payroll in the next few weeks as Congress debates whether to give the industry a cash infusion to combat the growing number of COVID-19 cases.
On a call led by the American Hospital Association on Saturday, three hospitals said they are weeks away from running out of money and don’t have the cash to buy critical supplies such as personal protective equipment. The comments come as the AHA and several other groups want Congress to add $100 billion in direct assistance to hospitals in the economic stimulus package expected to be voted on next week.
“We are now at a negative cash position and using credit,” said J. Scott Graham, CEO of Three Rivers and North Valley Hospitals in Washington State. “We will exhaust all avenues to make payroll in the next three to four weeks.”
Hospitals have been in a bind financially as they ramp up for treating more COVID-19 cases and shutting down elective surgical procedures, which are the biggest moneymaker for hospitals.
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Another problem is that some hospitals are not going to be able to go to banks for a line of credit.
“We can’t borrow more money to get through this,” said LaRay Brown, president and CEO of the safety net hospital One Brooklyn Health System in New York City.
But it remains unclear what type of assistance Congress will provide to hospitals.
Senate Republicans released a package that temporarily ends the sequester cuts to Medicare and boosts Medicare payments for COVID-19 cases.
But it does not include the $100 billion that the AHA, American Medical Association and American Nurses Association asked for earlier this month.
AHA officials were not concerned about the lack of direct funding for hospitals in the GOP proposal.
“That is just a first step,” said Tom Nickels, executive vice president of government relations and public policy for the AHA. “That document is not relevant right now because it has been massaged through negotiations.”
Senate Majority Leader Mitch McConnell had said earlier this week that he hoped to finalize talks and vote on a final package on Monday.
Nickels said that it remains unclear how much of the $100 billion would go towards helping hospitals meet payroll.
“We haven’t gotten to a point in the negotiations on what percentage goes to what but that is an ongoing conversation,” he said on the call.
