Monthly Healthcare Industry Financial Benchmarks for May 2024
Data from Strata
In May 2024, U.S. hospitals and physician practices experienced notable financial trends.
Hospital Performance:
Operating Margins: The median year-to-date hospital operating margin increased to 5.0%. Despite this growth, margins fluctuated, with a nearly 1 percentage point drop from April to May.
Expenses: Hospitals faced rising costs, with drug and supply expenses up by 8.3% and 8.1% compared to the previous year.
Admissions: Inpatient admissions rose by 11.7%, influenced by the expansion of the Two-Midnight Rule to Medicare Advantage patients.
Revenue: Outpatient revenue saw an 8% year-over-year increase, continuing a trend of strong growth.
Physician Practices:
Expenses: Total direct expenses per physician FTE increased to $1.09 million annually, a 12.8% rise from the previous year.
Investment Needs: The median investment per physician FTE grew by 11.2%, reflecting the rising costs of practice operations.
Revenues: Physician revenues climbed, with median net revenue per FTE up 11.4%, driven by higher productivity.
Patient Volumes:
Inpatient and Outpatient Visits: Both inpatient and outpatient visits saw significant year-over-year increases. Inpatient admissions rose by 6.1%, while outpatient visits grew by 3.3%.
Service Lines: All service lines reported higher patient volumes, with cancer services seeing the largest increase at 15.5%.
Children’s Hospitals: Metrics varied, with outpatient visits decreasing by 3% but inpatient admissions increasing slightly.
Key Trends:
Hospitals and physician practices face pressure from rising expenses, particularly for drugs and supplies.
Revenue growth remains strong, especially in outpatient services, though the pace has slowed compared to previous months.
Patient volumes are generally increasing, indicating a recovery in healthcare utilization.