“Healthcare providers as a group continue to operate with slim and shrinking margins,” according to recent analysis from Modern Healthcare. Sadly, that’s not a surprise to most of us. The study—which included acute-care, post-acute care, rehabilitation and specialty hospital groups as well as stand-alone hospitals— found that the average operating margin in 2013 was 3.1%, which was down from 3.6% in 2012. Over 61% of organizations saw their operating margins erode over the previous year.
While we’ve seen this coming, the news is sobering. And analysts are skeptical that the worst is over. According to Modern Healthcare, all three credit-rating agencies hold negative outlooks for the not-for-profit healthcare sector.