Hospitals saw increased expenses and bad debt, as well as a decline in patient volumes, in January, according to Kaufman Hall’s latest “National Hospital Flash Report,” which is based on data from more than 1,300 hospitals.
Four things to know:
1. Kaufman Hall said that in addition to persistent increases in drug and labor expenses, there was a significant increase in labor expenses in January. Nationally, total expenses per calendar day were up 5% year over year in January. Labor and supply expenses per calendar day were both up 5% year over year, while drug expenses per calendar day were up 7% year over year.
2. Carrying over from 2025, bad debt and charity care expenses continued to rise, according to the report. Bad debt and charity care per calendar day were up 8% year over year in January.
3. Patient volume decreased across inpatient and outpatient services in January. Kaufman Hall said the decline could be due to patients postponing elective procedures around the holidays, as well as a change in payer mix.
4. “Increased expenses, especially in labor, and the persistent increase in bad debt and charity care are not likely to ease this year,” Erik Swanson, managing director and data and analytics group leader at Kaufman Hall, said in a March 19 news release. “Overall structural costs are poised to go up. Hospitals will need to be strategic about where to allocate resources and how to manage spending in what could be a challenging economic environment.”
Read the full report here.
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