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July 2020
Revenue
Revenue by Region *
All five regions were up year-over-year and compared to budget for NPSR per Adjusted Discharge and NPSR per Adjusted Patient Day. For NPSR per Adjusted Discharge, hospitals in the Midwest saw the greatest year-over-year increase of 16%, while hospitals in the West saw the greatest increase to budget of 8%.
Hospitals in the Midwest also had the greatest year-over-year increase for NPSR per Adjusted Patient Day at 14%, and had the greatest increase to budget of 5%. Hospitals in the Great Plains, South, and Northeast/Mid-Atlantic also were up year-over-year for NPSR per Adjusted Patient Day, while hospitals in the Northeast were up year-over-year, but about 1% below budget.
NPSR per Adjusted Discharge
NPSR per Adjusted Patient Day
IP/OP Adjustment Factor
Bad Debt And Charity
Bad Debt and Charity as a Percent of Gross declined year-over-year and compared to budget across all regions in May. The West had the greatest decreases, falling 26% year-over-year and 28% below budget.
For the IP/OP Adjustment Factor, the West, Northeast/Mid-Atlantic, and Midwest all fell year-over-year and compared to budget, while the South fell year-over-year but was above budget, and the Great Plains increased year-over-year and compared to budget.
National Revenue Observations
Including CARES Act relief, total revenues were up in June compared to the same period last year, although without CARES Act funding, total revenues would have been only slightly elevated. Total Gross Revenue less CARES Act funding was up less than 2% year-over-year and fell 4% below budget. Inpatient Revenue rose slightly more than 1% compared to the same period last year and was 7% below budget, while Outpatient Revenue increased 1% year-over-year and fell 3% below budget. The increase in revenue likely results from the pent-up demand of elective procedures surging back in June, while other volumes remained well below their normal levels.
Even so, revenues saw gains compared to May 2020 performance, with Total Gross Revenue up 17%, Inpatient Revenue up 7%, and Outpatient Revenue up 27% month-over-month resulting from the recovering elective volumes. Bad Debt and Charity fell across all three measures, down 11% month-over-month and 8% year-over-year, and 9% below budget. The reduction in bad debt and charity may be due to the lag in time that these write-offs are recorded and result from the decreased patient volumes approximately 120 days ago.
Looking at revenues adjusted to the month’s low volumes, Net Patient Service Revenue (NPSR) per Adjusted Discharge fell about 1% month-over-month, but increased 8% year-over-year and was 5% above budget. NPSR per Adjusted Patient Day rose 5% compared to May 2020, 9% compared to June 2019, and 4% above budget.
The Inpatient/Outpatient (IP/OP) Adjustment Factor increased 8% month-over-month, but fell slightly year-over-year and was nearly at budget. Bad Debt and Charity as a Percent of Gross decreased 10% month-over-month, 11% year-over-year, and fell 9% below budget expectations, primarily owing to the increase in gross revenue this month as well as the lag in write-offs as previously mentioned.
Budget Variance
Month Over Month
Year Over Year
Year Over Year Distributions
(Click to enlarge)
Total Gross Revenue Less CARES
(3.7%)
17.5%
1.9%
total_gross_revenue.svg
IP Revenue
(6.8%)
7.2%
1.5%
ip_revenue.svg
OP Revenue
(3.4%)
27.1%
0.9%
op_revenue.svg
Bad Debt and Charity
(11.0%)
1.1%
(8.2%)
bad_debt_and_charity.svg
NPSR per Adjusted Discharge
5.3%
(0.6%)
8.1%
npsr_per_adj_discharge.svg
NPSR per Adjusted Patient Day
3.7%
4.6%
9.0%
npsr_per_adj_patient_day.svg
IP/OP Adjustment Factor
0.4%
8.2%
(1.2%)
ip_op_adjustment_factor.svg
Bad Debt and Charity as a % of Gross
(9.3%)
(10.6%)
(10.8%)
bad_debt_and_charity_percent.svg
Unless noted, figures are Actuals and Medians
Revenue by Bed Size
Hospitals in four of six bed-size cohorts were up year-over-year and above budget for NPSR per Adjusted Discharge. Hospitals with 300-499 beds saw the greatest increases at 12% year-over-year and 9% above budget. Smaller hospitals with 26-99 beds were up 8% year-over-year and 1% above budget, and hospitals with 0-25 beds were down 1% compared to the same period last year and 1% below budget.
All bed-size cohorts were up year-over-year for NPSR per Adjusted Patient Day. The smallest hospitals of 0-25 beds saw the greatest negative budget variance for this metric at -7%, while hospitals of 200-299 beds saw the greatest positive variance to budget at 6%.
NPSR per Adjusted Discharge
NPSR per Adjusted Patient Day
IP/OP Adjustment Factor
Bad Debt And Charity
For the IP/OP Adjustment Factor, smaller hospitals ranging from 0-99 beds were the only cohorts to increase both year-over-year and compared to budget. Hospitals with 0-25 beds saw the greatest increases at 3% year-over-year and 5% above budget. Hospitals with 200-299, 300-499, and 500 beds or more all were down year-over-year and below budget, while hospitals with 100-199 beds were down 2% year-over-year but performed 2% above budget for this metric.
Bad Debt and Charity as a Percent of Gross decreased year-over-year and compared to budget for hospitals in all bed-size cohorts. Hospitals with 0-25 beds saw the greatest decreases at 34% year-over-year and 30% below budget.
©2020 Kaufman, Hall & Associates, LLC
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