Health systems’ finances improved in 2026, but many organizations remain under enough pressure to keep tapping reserves, taking on debt, and turning to investment portfolios for financial flexibility, according to a new survey.
A new survey from Marsh (formerly Mercer) found that median operating margins among healthcare asset owners rose to 2% in 2026, the highest level since 2021.
But the report notes financial performance remains “relatively thin.” The survey (PDF) drew insights from 77 hospitals and health systems, with participants required to have at least one operating pension or insurance investment pool. Nearly 200 investment portfolios were reflected in results.
“Margins are improving, but many healthcare organizations are still relying heavily on reserves to manage operating pressure and liquidity,” said Meggan O’Shea, Marsh Investments and Retirement U.S. Healthcare Practice co-leader, in a statement. “In this environment, disciplined portfolio construction matters more than ever, as organizations balance risk and return to support both current needs and long-term resilience.”
Liquidity remains a persistent organizational issue, as 43% of respondents report expecting to draw on reserves in 2026—up from 37% the year prior. Analysts note the findings suggest reserve usage is “proving more persistent than expected,” adding that “investment portfolios remain a critical source of financial flexibility” for many organizations.
Moreover, 40% of respondents plan to issue debt this year—up from 31% in 2025—while 33% plan to draw on a line of credit.
Health systems are using a variety of methods to address operational stressors, including operational process improvements (94%), reduced capital expenditure (15%), staff or benefit reductions (20%) and relying on investment portfolios (20%).
Forty-six percent of respondents increased capital spending over the past year while 15% decreased spending and 40% reported no change.
Respondents also provided insight into organizations’ artificial intelligence investments. AI use in investment offices remains limited, as 75% or more of respondents report not using such tools for any investment activities.
Asset allocation has not seen any AI, though 9% of respondents report considering it. AI has been used in capital markets research and outlook (16%); manager due diligence (16%); operations (11%); administrative or audits (7%); risk monitoring (5%) and investment policy development (2%), the survey found.
However, the survey notes organizations are “increasingly pursuing the AI theme” from underlying investment standpoints.
“Within strategic healthcare and innovation programs, pursuit of AI-focused opportunities nearly doubled from 20% in 2025 to 39% in 2026,” the report said. “The survey suggests that organizations are embracing AI as an investment opportunity before fully incorporating it into their own investment processes. Tracking how that balance evolves will be an important focus of future editions of this report.”