Publications / The Financial Impact of COVID-19 on California Hospitals: January 2020 Through June 2021

In March 2020, most California acute care hospitals began postponing elective admissions and nonurgent care as the COVID-19 pandemic took hold. These developments had immediate impacts on California’s hospitals, with outpatient services and emergency department visits falling by approximately 50% over the next two months.

This report updates prior estimates of the impact of COVID-19 pandemic on utilization, costs, and revenue in 355 California acute care hospitals through the end of 2020.

The findings show that while patient volume in these California hospitals fell by 5% year over year, net patient revenue increased by $1.3 billion, largely driven by increased revenue from the Medi-Cal program.

After all revenues were totaled and expenses were deducted, California hospitals reported a substantial decrease in total net income in 2020 compared to 2019. Still, net income remained positive in 2020 at $3.47 billion compared to $7.96 billion in 2019.

The paper also demonstrates that Medi-Cal was the most important payer in stabilizing the financial status of many California hospitals during 2020. It provided an increase in patient services revenue of more than $2.8 billion, or 10% greater than 2019 levels.

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