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Hospital Industry – High Level Overview of Current Trends

November 1, 2022 By Chris David

Some current trends and changes in the hospital/health system space include the following:

  • Hospitals currently face structural challenges.
  • Focus on value-based care as a solution has declined.
  • There is a shift from an inpatient to an outpatient setting.
  • Hospitals are looking to provide integrated services through M&As.
  • Bigger players are not able to go for acquisitions even though cash might be available.
  • Government funds helped hospitals bear increased costs during the pandemic.
  • Government funds have dried up for non-profit institutions.
  • Pessimistic projections show profit margins declining by 133% in 2022.
  • Shrinking margins are primarily attributed to rising labor costs and workforce and supply chain issues.
  • Radical restructuring of operation models is seen as a way forward.
  • Public hospitals are considering restructuring into private not-for-profit standalone organizations.
  • Transparency with the community during the restructuring process will be important.
  • Buy-in from all stakeholders and proactiveness is becoming more important.

Filed Under: Sector Snapshot

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