Hospitals hoarding massive piles of cash got billions of dollars in federal coronavirus bailouts while vulnerable health centers were forced to scrape by, a new report says.
The feds have given more than $5 billion in grants to 20 big hospital chains that already had more than $108 billion in cash, the New York Times reported Monday.
The money was among $72 billion in grants the Department of Health and Human Services has distributed to hospitals and other providers since April under the CARES Act — the $2.2 trillion stimulus bill that Congress passed in March to shore up struggling businesses amid the pandemic, according to the paper.
But some grants went to well-heeled institutions with cash reserves so large they could afford to gamble some of them on Wall Street, the Times reported.
They include Seattle’s Providence Health System and the Cleveland Clinic, which got more than $700 million in combined aid after each reaped more than $1 billion in investment profits last year, the story says. Providence has nearly $12 billion in cash while the Cleveland Clinic had $7 billion last year, according to the Times.
The hospitals reportedly argued they needed the money to help offset hefty losses as the coronavirus crisis forced providers to limit elective surgeries and other non-essential services. For instance, Providence told the Times that its grant helped stave off layoffs or pay cuts for its staff.
“Remember, the pandemic isn’t over,” Providence spokeswoman Melissa Tizon told the paper. “We need to be financially stable for the next possible wave.”
But the bailout program reportedly gave some cash-strapped hospitals a pittance by comparison. Hospitals serving more wealthy patients with private insurance got twice as much aid as those that focus on poor people on Medicaid or no insurance at all, according to a Kaiser Family Foundation Study cited by the Times.
St. Claire HealthCare, Eastern Kentucky’s biggest rural hospital system, got just $3 million in federal money in April — enough to cover two weeks of payroll as the company grapples with a significant hit to its revenue, according to the paper.
“This is just a Band-Aid,” St. Claire chief executive Donald H. Lloyd II told the Times.