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Coronavirus: Why your local hospital may also need stimulus checks

Brian Sozzi
·Editor-at-Large

NewYork-Presbyterian CEO Dr. Steven Corwin is pulling no punches on the state of his 13-location hospital business as it continues to navigate the COVID-19 pandemic.

“I can tell you from hospital system, we are about $9 billion in top line revenue. We expect a loss anywhere from $600 million to $1 billion this year. It was on top of historic margins in the 3% to 4% range. It is a huge blow for us,” Corwin told Yahoo Finance’s The First Trade.

Corwin believes the government may have to step in with more stimulus funds after setting aside $100 billion for hospitals as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act.  

“I think what would be important in the HEROES Act would be to convert the Medicare Advantage payments to grants that benefits hospitals around the country. Of course you are seeing a lot of hospitals really struggle. So it would be a factor of more stimulus going to the hospitals, especially because what we are seeing in the smaller hospitals, rural hospitals, the safety net hospitals and the inner-cities, they are not going to be able to make it if they don’t get some additional monies,” Corwin said.

The bottom line blow for NewYork-Presbyterian — fueled by increased staffing and equipment costs — underscores how severe New York has been hit by the pandemic.

FDNY paramedics place an empty collapsible wheeled stretcher into an ambulance after delivering a patient into the emergency room at NewYork-Presbyterian Lower Manhattan Hospital, Wednesday, March 18, 2020, in New York. "Do not go to the emergency room unless it is a true, immediate and urgent emergency," said Mayor Bill de Blasio, who pleaded Tuesday with people who suspect they have coronavirus symptoms to stay home and see if they improve in a few days before even calling a doctor. For most people, the new coronavirus causes only mild or moderate symptoms. For some it can cause more severe illness. (AP Photo/Mary Altaffer)
FDNY paramedics place an empty collapsible wheeled stretcher into an ambulance after delivering a patient into the emergency room at NewYork-Presbyterian Lower Manhattan Hospital, Wednesday, March 18, 2020, in New York. "Do not go to the emergency room unless it is a true, immediate and urgent emergency," said Mayor Bill de Blasio, who pleaded Tuesday with people who suspect they have coronavirus symptoms to stay home and see if they improve in a few days before even calling a doctor. For most people, the new coronavirus causes only mild or moderate symptoms. For some it can cause more severe illness. (AP Photo/Mary Altaffer)

New York has had 414,000 COVID-19 infections and 32,228 deaths. New York City alone tallied close to 50% of New York’s total infections and more than that when it comes to deaths. The overall United States has seen 4.04 million COVID-19 infections and 145,000 deaths.

Corwin says he doesn’t have plans for a large scale cost-cutting program that puts patients at risk. But, he is looking at ways to trim expenses to keep his hospital network afloat and continuing to help fight the silent killer that is COVID-19.

“We’ll take cost out on the expense side. I will say that we made no layoffs a priority. First, we asked people to run through walls for us. We asked our employees to do the impossible. They did that. You know how difficult the pandemic was in New York. I can’t see turning around and saying to people we are going to lay you off. We will look at very tight position control. We have instituted a voluntary retirement program. So we are mindful of the fact that the cost structure will have to go down. Certainly there are many things on the expense and efficiency side that we can accomplish. We’ll get about $500 million in expense reduction, but without having to resort to layoffs,” Corwin explained.

Brian Sozzi is an editor-at-large and co-anchor of The First Trade at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.

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