Nonprofit hospital, health system financial metrics: 5 things to know

U.S. not-for-profit healthcare providers showed remarkable improvements to acute healthcare medians in 2021 compared to 2020, despite challenges presented by multiple surges of COVID-19 and a significant labor shortage, according to an Aug. 24 analysis from S&P Global Ratings.

The trend underscores the demand for services and the resiliency of management teams focused on financial performance and balance sheet preservation in addition to managing a challenging clinical environment.  

Key takeaways from the analysis include:

  1. The 2021 fiscal medians are the strongest in nearly a decade despite operational and financial volatility over the past two years.

  2. COVID-19 relief funding significantly supported financial performance and unrestricted reserves. The report notes that performance would have been considerably weaker without this support.

  3. Steady volume recovery contributed to net patient service revenue rebounding in 2021 after a decline in 2020, while total operating revenue continued to grow.

  4. Strengthening balance sheets lends stability, as almost all balance sheet ratios improved throughout 2021 after a healthy year of investment performance paired with management actions to preserve funds and the receipt of material government support.

  5. Expense and macroeconomic pressures are expected to affect future performance as wage, and inflationary pressures escalate and will likely cause a drag on performance for the remainder of 2022 and going into 2023.

Copyright © 2022 Becker's Healthcare. All Rights Reserved. Privacy Policy. Cookie Policy. Linking and Reprinting Policy.


Featured Whitepapers

Featured Webinars