A Jan. 29 blog post by Coronis Health highlights key themes that will shape the months ahead and how hospitals must adapt to evolving healthcare dynamics.
Three takeaways:
- The financial gap is widening. Hospital finances are generally holding steady, but the divide between strong and struggling institutions continues to grow. While 2024 marked a period of stabilization, the distribution of financial gains was not uniform. Larger systems with diversified revenue streams have fared better, while smaller or resource-constrained hospitals still face significant challenges.
- Outpatient care is driving revenue growth.
A significant shift toward outpatient services has been a key factor in financial recovery. Analysts at Kaufman Hall identified that outpatient revenue per calendar day increased by 13% year over year, surpassing inpatient revenue growth. Health systems are expected to continue investing in ambulatory networks, surgery centers and urgent care facilities. This shift not only improves access but also drives potential mergers and acquisitions, as financially constrained hospitals may seek partnerships to remain viable. Organizations are also expected to heavily invest in IT to drive patient access. - Operating margins show modest gains.
Fitch Ratings recently upgraded its outlook for nonprofit hospitals from “deteriorating” to “neutral,” with median operating margins projected to range between 1% and 2% in 2025. Labor shortages persist, but wage pressures have eased slightly and increased patient volumes are contributing to improved revenue streams. However, uncertainty remains regarding potential federal policy changes and external disruptions that could impact financial projections.
