The following is an excerpt from Becker’s Hospital Review.
Healthcare systems in the U.S. have had a challenging year, and they are on track for their worst financial year in decades, according to an Oct. 25 report from Health Affairs.
Dramatic margin fluctuations have characterized 2022, and U.S. hospitals are still operating substantially below pre-pandemic levels.
Most metrics improved month-over-month in August as revenues and expenses climbed compared to July. However, most organizations are in poor shape with a negative operating margin, according to the report.
Several factors suggest hospital margins will continue to face challenges in the coming years. The labor shortage is noted as the primary driver for rising hospital costs.
Nursing labor is a critical point as the report indicates hospitals have lost about 105,000 employees, and nursing vacancies have more than doubled.
In response, hospitals have relied on expensive contract nurses and extended overtime hours, which caused labor costs to surge.
The national nursing shortage is a continuing problem as a substantial segment of the labor force is approaching retirement, and the shortage of new nurses is projected to reach 450,000 by 2025.
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