Connecticut hospital officials are sounding the alarm on rising operating costs and workforce shortages.
At a virtual press conference on Wednesday morning, the state’s Hospital Association (CHA) released findings from an independent report commissioned by healthcare economics firm Kaufman Hall.
Among the findings: the state’s hospitals are collectively operating at a loss.
“The median operating margin is a negative 0.5% for hospitals in Connecticut, and this differs quite dramatically with what we see in the northeast and mid-Atlantic at 2.2% or the nation at 2.6%,” Kaufman Hall Senior Vice President Erik Swanson said. “This is particularly concerning as hospitals have emerged through this turbulent period of the pandemic and are at a very tenuous point in ensuring ongoing and sustainable operations.”
The report also found that hospital operating expenses increased by 6.5% between fiscal years 2022 and 2023—that’s two percentage points higher than the national rate.
Jennifer Jackson is the CHA’s CEO. She said the industry, which is Connecticut’s largest employer, has taken steps toward recovery since the pandemic but still isn't stable, and that hurts patient care.
“We still have really significant, concerning trends and challenges around workforce and capacity constraints, the costs of drugs and labor growing faster than national and regional rates and administrative roadblocks that affect wait times and interfere with patient care,” Jackson said.
According to the study, between FY 2022 and 2023, drug costs increased by 10%, workforce expenses by 4.4%. Nationally, those numbers were lower: 6% for drug costs, and 1.8% for workforce expenses. Medical supply cost increases were the same in the state and country at 6.2%.
Jackson wants state lawmakers' support in raising Medicaid reimbursement rates and improving health care worker recruitment and training during the 2025 session.
Connecticut’s rates have not been broadly adjusted in more than 15 years.
