The portion of hospitals operating at a loss has taken a big plunge downward--well, maybe not a "plunge," but a very large change continuing the economy in which the industry continues to work.
Health-industry analysts at Thomson Reuters have projected that the portion of hospitals operating at a loss have fallen from about half of all facilities to about 30 percent in the first quarter of this year. This pretty much brings the industry back into line with history, which saw losses of between 20 percent and 30 percent of hospitals between 2005 and 2007.
According to the data, much of the improvement has been driven by labor costs cuts of about 3 percent compared with the year-earlier period.
The Thomson Reuters figures come from about 500 hospitals of varied types, but show some general trends worth noting. Unfortunately, losses remain high because, while median revenue per patient has continued to increase through last year, expenses per patient are rising even faster. The desolate state of the financial markets has all but destroyed many hospitals' investment income.
To learn more about this analysis:
- read this Wall Street Journal Health Blog piece
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