Minnesota Hospital Association Report Reveals Hundreds of Millions in Operating Losses for 2023

The Minnesota Hospital Association (MHA) has released a new report that sheds light on the financial struggles facing the state’s healthcare industry in 2023. The report reveals that hospitals in Minnesota have collectively faced operating losses totaling over $400 million in the first six months of the year, more than double the losses reported during the same period in 2022.

According to Dr. Rahul Koranne, the CEO and President of MHA, two out of three hospitals included in the survey reported losing money. This alarming trend has already led to layoffs at major healthcare systems like Fairview and Allina, impacting hundreds of employees.

One of the major factors contributing to these losses is the lower reimbursement rates from federal programs like Medicare and Medicaid, which cover a significant portion of patients in Minnesota. Dr. Koranne highlighted that these programs pay below the cost of providing care, leading to over $2 billion in underpayment for hospitals in the state.

Additionally, the report cited a 6% increase in the cost of supplies and a 7% increase in the cost of labor as further challenges for hospitals. Mary Turner, the president of the Minnesota Nurses Association, emphasized the importance of adequate staffing to provide quality patient care, pushing back against claims of excessive labor costs.

Dr. Koranne called on the state legislature to address the workforce staffing challenges facing hospitals in the upcoming legislative session. He stressed the need for resources to ensure hospitals have the staff and funding necessary to continue providing essential care to patients.

The financial struggles outlined in the MHA report paint a grim picture for the healthcare industry in Minnesota, highlighting the urgent need for support and solutions to address the mounting losses and workforce challenges facing hospitals across the state.