More than two-thirds of hospitals anticipate incurring financial losses this year.
## Struggling Hospitals in Germany Face Economic Crisis Amidst COVID-19 Pandemic
Hospitals across Germany are grappling with unprecedented financial difficulties, a situation worsened by the COVID-19 pandemic. The financial woes of these institutions have been a growing concern since 2016, with key factors contributing to these challenges outlined below.
### Deficits and Debt
Over half of public hospitals and more than a third of all hospitals are currently in deficit. Many have borrowed heavily to maintain operations, requiring an EBITDA margin of 4-6% to service debts. However, this margin has been compromised by legislative initiatives, leaving hospitals in a precarious financial position.
### Investment Shortfalls
Public and non-profit hospitals are particularly affected by states' failure to meet investment obligations, leading to reliance on borrowed capital and further straining their finances.
### Structural Challenges
Rural hospitals face significant challenges against their urban counterparts, with socio-economic conditions, competition intensity, and infrastructure playing crucial roles in their success or failure.
### The Impact of COVID-19
The COVID-19 pandemic has further strained the financial situation of hospitals in Germany. The loss of revenue for affected hospitals during the first wave was approximately 2.5 million euros per facility, and the number of inpatient surgeries fell by an average of 41%. Moreover, the pandemic has affected general and intensive care units, as well as operating rooms.
### The Shortage of Skilled Workers
The shortage of skilled workers is another critical factor straining the financial situation of hospitals, particularly in operating rooms. This issue has been ongoing since 2020, with almost half of the hospitals unable to fill open positions in the non-medical OR and anesthesia department in 2020.
### Current Financial Situation
Despite these challenges, approximately 18% of the approximately 2,000 hospitals in Germany currently assess their financial situation as good. Conversely, two-thirds of hospital operators in Germany expect losses this year.
### The DKI Barometer
The DKI barometer indicates this trend, with the proportion of hospitals with a positive annual result decreasing from 61 to 29 percent since 2016.
### The Call for Action
Gerald Gaß, president of the German Hospital Association (DKG), has called for action, stating that responsible parties must not allow hospitals to be driven into insolvency. Gaß also emphasised the need for capacities for crisis times.
### Potential Future Implications
The financial struggles of German hospitals could have profound future implications:
- **Hospital Closures**: The inability to meet financial obligations may lead to widespread hospital closures, further reducing healthcare access, especially in rural areas. - **Economic Burden**: The pandemic has already resulted in significant economic losses for Germany. Continued healthcare challenges could exacerbate these economic strains. - **Healthcare Access and Quality**: The financial instability of hospitals could impact the quality of healthcare services, potentially leading to reduced patient care standards and increased healthcare disparities.
Addressing these challenges requires strategic restructuring and reorganization, focusing on operational efficiency and financial sustainability. Effective policy support and investment in healthcare infrastructure are crucial to mitigate these implications and ensure the long-term viability of German hospitals.
Economic and social policy reforms should prioritize strategic restructuring and reorganization of hospitals to ensure operational efficiency and financial sustainability in the face of ongoing challenges. Moreover, investment in science, health-and-wellness, and finance sectors is essential to support hospitals and improve patient care, as well as mitigate potential economic burdens and healthcare access and quality issues that may arise from hospital closures.
