What Are The Right Financial Metrics?

The non-profit hospital sector is undergoing a significant transformation following the pandemic. Labor costs are up, inpatient utilization is down, and pandemic-era rules and subsidies are gone. This has led the rating agencies to ponder whether nonprofit hospitals can maintain a 3% margin—or the ‘standard’ needs to be reset to 1% or 2% (see Will There Be New Baselines For Nonprofit Hospitals’ Financial Metrics? Fitch Weighs In and Tough Labor Market Holds Fitch’s Nonprofit Hospital Outlook At ‘Deteriorating’). If the lower figures persist beyond a short transitional period, analysts are concerned that could lead to a . . .