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The newly released MedPAC 2018 Data Book Shows Deteriorating Hospital Margins

July 27, 2018

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PRESS CONTACTS
Susan Xu, Lead Research Analyst

The Medicare Payment Advisory Commission (MedPAC) July 20 released its June 2018 data book on health care spending and the Medicare program. The MedPAC Data Book provides statistics, trends, and figures on national health care and the Medicare program, including information on Medicare beneficiary, access, and utilization of health care services, and Medicare’s payment systems. It also examines provider settings, such as hospitals, and presented data on utilization pattern and financial health of Medicare providers.

One data point of growing concern is deteriorating hospital margins. Chart 6-19 shows continued decline in hospitals' overall Medicare margins, from -5.1% in 2013 to -9.6 in 2016. MedPAC’s analysis also shows that “about 30 percent of hospitals had positive overall Medicare margins in 2016.” Total hospital margins for all payers (Chart 6-21) shows similar downward trends since 2013, even though on average hospitals maintained a positive margin at 6.4 in 2016.

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