North Carolina’s wealthiest hospitals record profits after receiving COVID relief funds

State Treasurer Dale Folwell

According to a report released by the state treasurer’s office on Wednesday, June 22, seven of North Carolina’s largest hospital systems made billions of dollars in profit during the COVID-19 pandemic, while also claiming another $1.5 billion in taxpayer-funded relief.   

The analysis, which was carried out by the State Health Plan and the National Academy for State Health Policy, examined the audited financial reports of Atrium, Novant, UNC, Duke, Vidant, Cone, and WakeMed Health. The study was also peer reviewed by Dr. Ge Bai, Professor of Health Policy & Management at Johns Hopkins Bloomberg School of Public Health, and Professor of Accounting at the Carey Business School.  

Based on the report, these seven hospital systems documented a record $7.1 billion in growth in cash and financial investments from 2019 to 2021, after amassing a collective $5.2 billion in net profits in 2021, taking the aforementioned COVID-19 relief aid, and collecting an additional $1.6 billion in Medicare and Accelerated and Advance Payments from 2020 to 2021.   

In addition to noting how these hospitals received relief funds set aside for struggling hospitals, it also details how they “failed to dedicate more than a fraction of their windfall to increasing charity care for their suffering patients.”   

After claiming the bulk of the COVID-19 relief funds, the wealthy hospitals recorded such a massive growth in cash and investments that it surpassed the state’s allotment for K-12 education. Duke Health alone exceeded the average net profit margins for tobacco and investment banking in 2021.   

Out of the seven, Atrium Health took the most taxpayer relief dollars, collecting $589 million in COVID relief and another $438 million in Medicare advance payments. Atrium Health then made a $1.7 billion net profit after its merger with Wake Forest Baptist Health in 2021.   

“Some things are worth getting mad about. The hospital cartel is using taxpayer dollars to help crush the middle class and rob lower-income families of upward mobility,” said State Treasurer Dale Folwell. “Wealthy hospitals took billions of taxpayer dollars meant to protect struggling hospitals — and then some billed poor families or even sued patients.”  

Folwell is not the only one troubled by the details of the report, as several other experts have also weighed in with concerns that a disproportionate distribution of relief funds could lead to hospital price inflation and further consolidation. Folwell is personally calling on each of these hospital systems to return the money, or at least use their profits to lower costs for their patients and increase charity spending.   

Despite the substantial figures recorded by each of the hospital systems, the report reveals that charity care spending fell across a third of hospitals in 2020. Meanwhile, local communities struggled with economic lockdowns, job losses, and the spread of the coronavirus.  

“Hospital executives made record profits off of the backs of sick people during the pandemic and decades before,” said Folwell. “We have a duty to make health care affordable for North Carolina families. We have a duty to hold hospital executives accountable for wrecking the financial health of thousands of patients and transferring wealth from citizens to them.”

About Griffin Daughtry 10 Articles
Griffin Daughtry is the Business & Features Editor for the North State Journal.