Moody's: Hospitals with higher quality of care have stronger operating cash flow margins


A recent analysis of CMS data by Moody's Investors Service shows the link between a hospital's value-based purchasing and patient experience scores and its financial results.

Hospitals with above-average VBP scores in 2015 had a median operating cash flow margin of 11.7 percent, while those with below-average scores had a median operating cash flow margin of 8.6 percent, according to Moody's.

Regardless of hospital size, nonprofit hospitals with stronger VBP and patient experience metrics recorded higher operating cash flow margins in 2015, according to the report.

"As reimbursement moves away from fee-for-service to an emphasis on value and outcomes, a hospital's ability to improve quality of care and the patient experience will increasingly impact its financial performance," according to Moody's.

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