The average margin for nonprofit hospitals increased from 1.6% in May to 3.7% in June, according to Kaufman Hall’s “National Hospital Flash Report,” released Aug. 11.
Kaufman Hall gathers data from 2,300 hospitals across the U.S. to report on average hospital financials nationally and regionally. In June, hospitals reported the highest average monthly margin since December 2024.
Five things to know:
- The average hospital operating margin jumped 15% year over year in June, and 5 % month over month. Operating EBITDA margin increased 6% in June, compared to the same period last year.
- Net operating revenue per calendar day was up 9% year over year, outpacing expense increases at 6%.
- Drug expenses increased 12% year over year, driving overall expense growth. Labor expenses increased just 4% while supply expenses were up 9%.
- Hospitals in the Northeast and Mid-Atlantic reported the largest operating margin increases, while others experienced significant drops. Year-over-year operating margin change by region:
- West: -13%
- Midwest: 29%
- South: 29%
- Northeast / Mid-Atlantic: 38%
- Great Plains: -27%
5. The average margin soared for some hospitals while others reported big declines. Year-over-year operating margin change by hospital size:
- 0-25 beds: 1.4%
- 26-99 beds: 30%
- 100-199 beds: 17%
- 200-299 beds: 29%
- 300-499 beds: 13%
- 500+ beds: -29%
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