August 2018
Predictions for Next Month
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Regional Predictions ?
Regionally, hospitals in the Great Plains are anticipating the largest decreases month-over-month, with profitability approximately matching that of last year. The hospitals in this region tend to be smaller in size given the decreased population density, with performance more closely aligning with the 0-25 bed size cohort. The West has tended to be very optimistic in performance budgets, and next month that level of optimism has decreased as compared with prior months. The Midwest is projecting the highest year-over-year increases next month as compared with last year, however their current performance has been weak, so next month’s report will follow-up to determine if they truly expect an improvement from changing operations or if this is a case of lack of budget precision. Together, the western regions seem to anticipate a decrease from current operations with the eastern regions anticipating an improvement over current operations.
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National Profitability Predictions
Nationally, hospitals are predicting an increase in profitability next month over last year, a budgeting trend that has been observed over the last several issues of the flash report. Actual performance has tended to be slightly stronger than last year, however the budgeted figures tend to be more ambitious than what is actually achieved. As mentioned in the profitability section, this further demonstrates that the budgeting process of most organizations needs improvement in precision and predictive powers. That being said, EBITDA and Operating margins are projected to be favorable year-over-year, with EBITDA favorable month-over-month and Operating margin unfavorable month-over-month suggesting that next month will have increased depreciation pressures from capital.
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
5%
32%
Operating Margin
-1%
38%
Month Over Month
Year Over Year
Year Over Year Distributions (Click to enlarge)
Operating EBITDA Margin
42.50
259.50
Operating Margin
-10.00
228.00
Profitability Prediction % Change
Profitability Prediction Absolute Change
By Region
National Predictions
By Bed Size
Resources and Comments
Bed Size Predictions
Almost all bed sizes are projecting favorable year-over-year increases next month, with the smallest bed size cohort matching last year’s performance. The 100-199 bed size cohort is an outlier, with very high year-over-year and month-over-month increases setting them apart from others. While the smaller bed size organization are projecting a year-over-year increase, they are also projecting a decrease from the current month, demonstrating that the favorable trends of this year will decline slightly next month.
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By Region
National Predictions
By Bed Size
Resources and Comments
©2018 Kaufman, Hall & Associates, LLC
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