Hospital profitability has been steadily rising in the last year, but they're still far away from pre-pandemic levels, according to the Kaufman Hall "National Hospital Flash Report," released Jan. 9.
Hospital operating margins jumped 20% year over year in 2023 through the month of November, and operating EBITDA margins were up 9%. However, compared to 2020, operating margins and operating EBITDA margins are down 9% and 10%, respectively.
Revenue is up compared to 2020, with net operating revenue per calendar day jumping 21% from three years ago and gross operating revenue per calendar day climbing 30%. There is also a clear shift from inpatient to outpatient, with outpatient revenue per calendar day up 43% while inpatient revenue per calendar day jumped just 15%.
But expenses are also rising.
The total expense per calendar day jumped 20% from 2020, with labor and supply expenses per calendar day up 20% and 23%, respectively. The average length of stay is flat while emergency department visits were up 19% overall compared to 2020.
Here is the regional breakdown of profitability statistics for January to November, 2020 compared to 2023.
West
Operating margin: -36%
Operating EBITDA margin: -31%
Midwest
Operating margin: -24%
Operating EBITDA margin: -26%
South
Operating margin: 19%
Operating EBITDA margin: 6%
Northeast / Mid-Atlantic
Operating margin: -4%
Operating EBITDA margin: -5%
Great Plains
Operating margin: -9%
Operating EBITDA margin: -14%