The median operating cash flow and margins are expected to improve next year for most nonprofit hospitals, according to a new report from Moody’s Investor Services.
Moody’s revised the outlook for the nonprofit healthcare sector to stable from negative, citing slower expense growth. Nonprofit hospitals are reigning in labor costs and reporting a “modest rebound” in patient volumes. They are also seeing higher reimbursement rates, which could mean higher revenue next year.
“These factors signal that a financial recovery will increasingly take hold in 2024, marked by an uptick in cash flow margins. While some government initiatives pose risks, increased state financial backing and Federal Emergency Management Agency funds will aid some healthcare providers’ financial turnaround,” the report notes.
Operating cash flow hit nearly -40% last year, but is projected to have double-digit growth this year. The operating cash flow growth will mean hospitals can invest in facilities and programs for the future, Becker’s reports. Read more.
