U.S. healthcare organizations faced mixed financial performance in August, with operating margins narrowing and patient demand stalling, according to Strata Decision Technology.

. Health system operating margins: Declined from 2.1% in July to 1.9% in August.
. Hospital operating margins: Slight increase from 4.8% to 4.9% month-over-month.

Steven Wasson, Chief Data and Intelligence Officer at Strata, noted, “While expense increases have slowed from July’s alarming spikes, they continue rising with no signs of relief.”

. Patient volumes: Outpatient visits down 0.5%, observation visits fell 4.2%, and emergency visits decreased 4.9% YOY.
. Inpatient admissions: Up 3.5% YOY but down 0.7% from July to August.
. Infectious diseases: 20.5% YOY surge due to rising COVID-19 and pertussis cases.

On the cost side, non-labor expenses outpaced labor costs, rising 6.2% YOY, while overall expenses grew 6.2%. Supply and drug expenses slowed considerably after July’s double-digit growth.

. Hospital revenue: Gross operating revenue and inpatient revenue increased 6.1% YOY, with outpatient revenue up 5.6%.

Regions saw varying results, with hospitals in the Northeast/Mid-Atlantic reporting the largest YOY margin decline (1.1 percentage points), while those in the South saw the biggest gain (1.9 percentage points).