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Hospital performance in November signals continued stabilization and growth as operating margins improve. The median Kaufman Hall Calendar Year-To-Date Operating Margin Index reflecting actual margins was 2.0% in November.

Hospital performance in October reflects continued stabilization with margins above pandemic levels and volumes holding steady. The median Kaufman Hall Calendar Year-To-Date Operating Margin Index reflecting actual margins was 1.2% in October.

While hospitals’ overall performance declined slightly in September compared to the previous month, the median Kaufman Hall Calendar Year-To-Date Operating Margin Index reflecting actual margins was 1.4% in September.

Physicians are operating at record-high levels of productivity compared to recent years but receiving less pay per unit of work. The median investment/subsidy per provider continues to increase, but the pace is slowing with only a 1% change from Q3 2022 to Q3 2023.

While hospital operating margins remain below historical levels, overall conditions have stabilized in 2023. The median Kaufman Hall Calendar Year-To-Date Operating Margin Index reflecting actual margins was 1.1% in August.

Hospitals’ financial performance worsened in July as volumes fell, but margins remain improved from 2022. The median Kaufman Hall Calendar Year-To-Date Operating Margin Index reflecting actual margins was 1.3% in July.

Most hospitals underperformed in June as high expenses and economic pressures persist. As margins continue to stabilize on the surface, the gap between high-performing hospitals and those struggling in this new “new normal” is widening.

Physician and provider productivity is on the rise as patients increasingly seek care in ambulatory settings. However, increased revenue and productivity in Q2 was not enough to offset rising expenses as the median investment/subsidy per provider still rose 5% year-over-year to $224,243.

Recently, Erik Swanson and Robert Turner joined the Reorg podcast with reporter Hoa Nguyen to explore hospital financial performance and healthcare financing trends through the rest of 2023.

Hospital finances showed signs of stabilizing in May amid slightly improving operating margins, declining expenses and notable increases in outpatient visits.

Hospital finances broke even in April amid a continuing trend of high expenses and the unwinding of the Medicaid continuous coverage requirement of the COVID-19 public health emergency

Hospital finances improved slightly in March as hospital leaders navigate high expenses and economic pressures. While margins continue to stabilize, they remain below pre-pandemic levels—leaving hospitals in a vulnerable position should a recession or new public health emergency arise.