Hospital Financial Performance and Trends Report

This report presents an analysis of the financial performance of U.S. hospitals and health systems for the first quarter of 2024, based on data from Strata Decision Technology. It details the median operating margin of hospitals, which was recorded at 4.7% in March, marking an 11th consecutive month of year-over-year increases in gross operating, inpatient, and outpatient revenues. The report outlines the shifts in expense and revenue metrics, noting that labor expenses rose by 3.5% compared to March 2023, while non-labor expenses increased by 2%. The report also highlights a significant change in revenue growth, with inpatient revenues surpassing outpatient revenues for the first time since late 2021. Additionally, it documents the rise in inpatient admissions and the decrease in outpatient visits, attributing some changes to the implementation of the Two-Midnight Rule by CMS. The report concludes with a summary of data sources and the methodology used for analysis.