The Great American Bed Shed: Hospital Beds Continue to Disappear


Timothy Kelley
Senior Contributing Editor

Hospitals can’t just follow a “heads in beds” strategy. The number of hospital beds in the U.S. has been declining for decades.

The total number of hospital beds in the U.S. has been declining for decades. “Care is increasingly shifting from inpatient settings to outpatient settings,” says Marie Johnson of the American Hospital Association. 

The list of reasons is long, its ordering in the eye of the beholder: Cost pressures, mergers, surgical innovations that mean shorter stays, the rise of standalone surgical centers, more effective medicines, and patient preference for the home setting. The national total of “staffed” beds slipped below the million mark just before the turn of the century; in 1990, it had been 1,213,327; in 1975, 1,465,828.

There are 534,000 fewer hospital beds now than in 1975.

But what’s this? The AHA had reported a 2016 total of 894,574, but then 931,203 for 2017, the latest year with available data—implying at first glance that there was a more than 36,000-bed increase in the latter year. 

The reason is not a burst of new beds, but a change in the method of counting beds, the hospital group explains. Until this year (that is, until the 2017 data), the AHA had a voluntary system of registering hospitals and counted only registered ones in its tabulations. It was an inclusive process—a hospital didn’t have to be an AHA member to be registered—but still it effectively left out about 700 institutions.

Today the new system takes in all hospitals licensed by the appropriate state agency and accredited by one of the main accreditors. Adding those newly included hospitals created an illusory one-time statistical bump, but in truth the bed total is still declining.

That downward trend, of course, reflects a decline in the number of hospitals (nationally there were 6,210 in 2017, says AHA) with some converting to outpatient-only facilities. According to a March 2019 report from MedPAC, an independent analyst group that advises Congress on Medicare, 29 new hospitals opened from 2015 through 2017—but 65 closed—mostly small ones, 52% of them in rural counties. About two thirds of those closures were in states that hadn’t expanded Medicaid under the ACA.

But weep not for the hospital industry. Between October 2015 and October 2018, MedPAC goes on to report, the national ranks of hospital employees grew from 4.9 million to 5.2 million. That 5.6% increase lagged behind the rest of health care (with 6.8%) but outperformed the remainder of the economy, in which jobs grew by only 4.8%. “Overall [industry] profitability was relatively high,” adds MedPAC as it summarizes 2017, noting that “hospitals’ access to capital remained strong.”

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