US Hospital Financials Off to a Rocky Start in 2022

by Erik Swanson

2022 is off to a bad start for U.S. hospitals and health systems. Hospital operating margins remained in the red for a second consecutive month in February as healthcare providers continued to feel the repercussions of the Omicron surge. COVID-19 cases and hospitalizations plummeted in February from January’s all-time highs, driving decreases in inpatient volumes while outpatient volumes staggered to recover. Margins and revenues declined as a result.

Lower volumes meant hospitals had some expense relief compared to January, but expenses remained high versus prior years due to the ongoing effects of nationwide labor shortages and global supply chain issues. From January to February:

• Median change in Operating Margin dropped 11.8%

• Patient Days decreased 13.3%

• Gross Operating Revenue declined 7.4%

• Total Expense per Adjusted Discharge decreased 4.5%

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