Enhanced COVID-19 Provider Relief, Hospital Finances, and Care for Medicare Inpatients.

Abstract

Importance: Congress appropriated $178 billion in emergency relief for health care providers (hospitals, physicians, and other health care professionals) in 2020 to stabilize finances and support the COVID-19 pandemic response. The US Department of Health and Human Services directed $35 billion of these funds to safety-net hospitals and high-impact hospitals using strict criteria. However, the importance of enhanced funding is inadequately understood.

Objective: To evaluate the association between enhanced COVID-19 relief funding and hospital finances and clinical care for Medicare inpatients.

Design, setting, and participants: This retrospective cohort study used a differences-in-discontinuities study design with overlap weighting. Nonrural hospitals with data on costs and fee-for-service Medicare inpatient care for 2018 to 2021. Hospitals near a threshold for receiving high-impact and/or safety-net hospital funding were analyzed. Data were analyzed from July 2022 to January 2025.

Exposures: Receipt of high-impact and/or safety-net hospital relief funds.

Main outcomes and measures: Financial outcomes related to revenues, costs, margin, and liquidity and clinical outcomes related to volume, care processes, and mortality.

Results: A total of 555 hospitals were included, with 311 receiving high-impact and/or safety-net hospital funds. Hospitals not receiving enhanced relief averaged $7.0 million in total relief (about $45 000 per bed), while hospitals receiving enhanced relief averaged $15.4 million in total relief (about $100 000 per bed). Operating revenues in 2020 increased by 4.5% (95% CI, 3.0-5.9) among basic relief hospitals and 6.1% (95% CI, 4.6-7.6) among enhanced relief hospitals. However, total costs grew similarly (basic relief: 4.6%; 95% CI, 3.6-5.6; enhanced relief: 4.5%; 95% CI, 3.4-5.7). This resulted in a significant differential increase of 1.4 points (95% CI, 0.3-2.5) in operating margin in association with enhanced relief. Enhanced relief was also associated with limited deterioration in liquidity (differential increase in net asset ratio of 0.03 points; 95% CI, 0-0.05). There was not a significant association between receipt of enhanced relief and fee-for-service Medicare inpatient admissions (-19.6 stays; 95% CI, -281.0 to 241.8), use of a sentinel deferrable procedure among fee-for-service Medicare inpatients (-3.9 admissions for lower joint replacement; 95% CI, -29.6 to 21.7), or use of 2 resource-intensive services among fee-for-service Medicare inpatients (-0.3 admissions with ventilation; 95% CI, -20.8 to 20.2; 0.9 admissions with dialysis; 95% CI, -15.4 to 17.1). Enhanced relief was not detectibly associated with change in the complexity (change in Charlson Comorbidity Index score, 0 points; 95% CI, 0-0) or inpatient mortality (-2.9 deaths; 95% CI, -11.3 to 5.5) for fee-for-service Medicare inpatients.

Conclusions and relevance: In this study, enhanced emergency relief for hospitals was associated with improved margins and liquidity without detectible changes in spending or service provision.