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September 2019
Predictions for Next Month
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Regional Predictions *
There is significant variation in October expectations. Hospitals in the Great Plains anticipate relatively flat Operating EBITDA Margin performance both month over month (-2.3 percent) and year over year (-1.8 percent). The Great Plains region consists primarily of smaller hospitals which are predicting lower-than-anticipated margins, but are expecting year-over-year decreases to be offset by the larger hospitals. Hospitals in the Northeast/Mid-Atlantic, however, expect Operating EBITDA Margin to increase about 40 percent, both month over month and year over year.
The results are similar for basis point predictions, with most regions anticipating month-over-month and year-over year increases in Operating EBITDA Margin. Hospitals in the West predict the largest month-over-month increase at 321 bps, while those in the Northeast/Mid-Atlantic predict the largest year-over-year increase at 276 bps.
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Absolute Change
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National Profitability Predictions
Hospitals across the country anticipate strong margin performance in October. Operating EBITDA Margin is predicted to rise 18.9 percent year over year, or 141 bps. Operating Margin is expected to increase 10.4 percent, or 84.5 bps. Looking at month-over-month predictions, Operating EBITDA Margin is expected to rise 17.7 percent or 167 bps, while Operating Margin is expected to increase 17.6 percent or 138 bps. The strong growth predicted in month-over-month margins is driven primarily by the unexpectedly weak performance this month, and highlights the continued optimism of budgets.
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
17.7%
18.9%
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Operating Margin
17.6%
10.4%
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Month Over Month
Year Over Year
Year Over Year Distributions (Click to enlarge)
Operating EBITDA Margin
167.0
141.0
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Operating Margin
138.0
84.5
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Profitability Prediction % Change
Profitability Prediction Absolute Change
By Region
National Predictions
By Bed Size
Resources and Comments
Bed Size Predictions
Most bed-size cohorts anticipate an increase in Operating EBITDA Margin performance in October, both month over month and year over year. The smallest hospitals of 0-25 beds are one exception, with expectations of -7 percent (or -39 bps) month over month, despite an anticipated 23 percent (or 147 bps) gain year over year. The smallest hospitals’ profitability tends to be driven by volume, and that cohort may expect to maintain the increase in patient days year over year that it experienced in August. Hospitals with 26-99 beds expect month-over-month performance to be flat, and year-over-year performance to fall -10 percent (or -123 bps).
Hospitals with 100-199 beds anticipate the largest increases, with Operating EBITDA Margin expected to rise 58 percent or 418 bps month over month, and 46 percent or 292 bps year over year—indicating that they expect to bounce back from August’s poor performance.
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By Region
National Predictions
By Bed Size
Resources and Comments
©2019 Kaufman, Hall & Associates, LLC
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