June 2018
Predictions for Next Month
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Regional Predictions ?
Nearly all regions are predicting a decline in profitability from July of 2017 but yet still improve from May 2018. Great Plains Hospitals being the only exception. Great Plains region not only predicted a decline in operating EBITDA margin over the past year but also expected margins to come in nearly 30% under May actuals. Midwest and West have the most optimistic margins for July with expectations to exceed May actuals by greater than 23%. For most, a positive sign with hospitals expecting an improvement over operating EBITDA margin results.
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National Profitability Predictions
Year-over-year from July 2017 to July 2018, organizations had predicted a decline in operating EBITDA margin. However in July, hospitals are expecting an improvement over May by 12.6%. With recent May profitability results exceeding budget by 12%, July very well may meet this expected 12.6% change. Continued emphasis on expense reduction and efficiencies gained from the transition from inpatient to outpatient volume appears to be contributing to this improved outlook. Favorable reimbursement estimates are also contributing to the expected profit increase but those reimbursement estimates are subject to change as organizations approach their year-end reimbursement audit results.
Unless noted, figures are actuals and medians expressed as percentage change
Unless noted, figures are actuals and medians expressed in basis points
Month Over Month
Year Over Year
Year Over Year Distributions (Click to enlarge)
Operating EBITDA Margin
12.6%
-16.5%
Operating Margin
12.7%
-25.5%
Month Over Month
Year Over Year
Year Over Year Distributions (Click to enlarge)
Operating EBITDA Margin
179.6
(330.0)
Operating Margin
155.6
(377.2)
Profitability Prediction % Change
Profitability Prediction Absolute Change
By Region
National Predictions
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Bed Size Predictions
Bed size offers a slightly different perspective. Hospitals less than 200 beds are predicting more aggressive increases in operating EBITDA margin from May of 2018 to July of 2018 while hospitals greater than 200 beds are predicting modest changes in operating EBITDA margin. The delta of the operating EBITDA margins between the two bed ranges may be attributed to the increased volume predictions of the smaller hospitals therefore allowing them to leverage the economies of scale to control cost.
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National Predictions
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©2018 Kaufman, Hall & Associates, LLC
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