Labor costs that outstrip increases in reimbursements will lead hospitals to continue to have low operating margins through 2025, according to Moody’s, the bond and credit rating company.
While the growth of hospital labor costs is no longer as great as it was during the COVID-19 pandemic, Moody’s reports, labor costs continue to grow – as do supply costs. Meanwhile, reimbursements are not keeping pace, with government payments especially lagging.
As a result of these factors, hospital margins and operating cash flow margins are down and prospects for recovery in the coming year are only modest.
Learn more about how Moody’s sees hospital financial performance in the coming year from the Becker’s Hospital Review article “Hospital operating margins to stay low in 2025: Moody’s.”