New Jersey hospitals have taken a historic financial hit due to the coronavirus pandemic.

A report on the first half of 2020, from the Center for Health Analytics, Research and Transforming at the New Jersey Hospital Association, shows an average statewide operating margin in the negatives. Nearly 60% of the facilities were operating in the red even as cases of COVID-19 slowed down in the state and more procedures that had been blocked for safety reasons were permitted to occur.

"We're still feeling the financial impacts as we head into fall," NJHA president and CEO Cathy Bennett told New Jersey 101.5.

Specifically, the report shows total patient revenues declined 6.6% from the year prior, and hospital admissions fell by 8%. Outpatient visits dropped by 22%, and emergency department cases plummeted 23%.

In April and May 2020, hospitals statewide performed just 400 elective procedures such as knee replacement, hernia repair, pacemaker insertion and spinal fusion. In April and May 2019, more than 4,300 elective procedures were performed. An executive order from Gov. Phil Murphy in March of this year, which lasted for two months, required hospitals to suspend elective procedures, except for cases in which a delay could harm the health of the patient.

"At the same time, we have the aggravating factor of an increase in operating expenses, especially those related to the pandemic," Bennett said. "That was felt particularly through the spring surge, and as we prepare for the pandemic winter, those operating expenses are starting to increase again, because we're not just maintaining an inventory for normal operations — we're creating a big stockpile so we can deal with a resurgence."

Bennett said there's real concern surrounding the 23% drop in emergency department cases. A consumer survey led by the Association in September found that people are still wary about the potential threat of COVID-19 in healthcare facilities, but reassured by the list of safety precautions in place at hospitals.

To help allay concerns among potential patients, the Association is launching a campaign highlighting those protocols, and the importance of not delaying medical procedures.

"COVID-19's fiscal impact on our hospitals reaches historic levels," said Sean Hopkins, senior vice president of CHART. "The last time we saw margins dip this deep into the red was in the late 1990s when hospitals sustained deep federal payment cuts under the Balanced Budget Act of 1997. At that time, we saw margins fall to -1.7% and -2.3% in 1998 and 1999, which pales in comparison to the numbers we're seeing today."

The state's hospitals employ 154,000 people, according to the Association. They'd typically pump $25 billion annually into the economy.

Contact reporter Dino Flammia at

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