Hospitals Face a Rocky Recovery to Financial Health, AHA Says

The American Hospital Association published a blog on research it said confirms what hospitals and health systems have been saying: That 2022 was among the most financially challenging years the hospital field has experienced and that recovery remains challenging.

Fitch, Moody’s and S&P Global Ratings released reports describing how nearly every metric of hospital and health system financial health declined in 2022, according to the AHA. Operating margins and earnings deteriorated significantly and days of cash on hand declined. As a result, most agencies are reporting significantly more credit rating downgrades than upgrades.

Research from the Urban Institute released in August examined the financial vulnerability of hospitals and health systems throughout the pandemic. The study found that operating margins plummeted to negative 40% in April of 2020, underscoring how important federal support was for hospitals to remain financially viable during the pandemic, the AHA said. Kaufman Hall’s August National Hospital Flash report suggests that financial recovery may have slowed or reversed, Healthcare Finance reports. Read more.

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