Hospitals faced significant financial pressures in 2025, driven largely by rising labor costs, revenue cycle challenges and increasing supply expenses, according to new data from Kaufman Hall. Health systems are responding with staffing optimization, outsourcing non-core services and tighter cost controls.
Hospital margins improved in June as revenue gains outpaced patient volume — but Kaufman Hall’s latest data shows that financial gaps between high- and low-performing organizations persist, with increasing expenses and bad debt threatening long-term stability.
AI-native tax firm Gelt combines top human tax experts with AI to help physicians and healthcare practices use data-driven tax strategies to lower liabilities, improve profitability, and future-proof their finances.
Translucent AI raised $7 million in seed funding to help healthcare providers better manage mounting financial pressures. Its AI-powered platform is designed to give hospital leaders instant, plain-language answers to complex financial questions.
Some hospitals are turning to AI to help manage declining revenue and financial pressure, but one expert says success depends on more than just buying new tech. Prashant Karamchandani of Chartis urges health systems to pair AI adoption with foundational work like change management, continuous improvement and operating model redesign.
Hospitals saw improved financial performance during the first four months of the year, with operating margins rising to 3.3% thanks to higher patient volumes and more efficient throughput. However, experts warn that hospitals remain financially vulnerable as non-labor expenses continue to rise.
During a recent panel, hospital leaders discussed how they approach the balancing act between innovation and financial sustainability. They shared tactics such as reassessing vendor contracts, leaning into existing tech capabilities and finding creative ways to support patients without compromising margins.
In a landscape where complexity has long been the norm, the power of one lies not just in unification, but in intelligence and automation.
Hospitals started 2025 with a stable financial performance driven by strong patient volumes, but rising costs for drugs, supplies, and services continue to put major pressure on margins.
New research found that most healthcare CFOs anticipate minimal financial gains this year due to high labor costs and insufficient payer rates. While providers are leveraging more data to improve financial planning, persistent challenges like wage pressures, recruiting difficulties and payers' increasing use of technology to deny claims continue to strain margins.
This year will likely see a high rate of divesture among hospital M&A deals, according to Anu Singh, managing director at Kaufman Hall. He also predicted that health systems will continue to pursue partnerships with a broader array of organizations, such as payers and venture firms, to solve challenges.
Hospitals’ operating margins dropped in November due to decreased patient demand levels and continued increases in expenses, according to a new report. One healthcare expert noted that rising expenses will remain a major problem for hospitals throughout 2025.
Alan Murray on improving access for medical transportation.
The Affordable Care Act's enhanced subsidies are at risk of expiring at the end of 2025, and healthcare leaders are worried about what could happen if Congress doesn’t renew them. For instance, more Americans would become uninsured, premiums would increase, and hospitals would be saddled with more bad debt due to uncompensated care.
Hospitals’ finances have been much more stable in 2024 than last year, according to a new report from Kaufman Hall. Some contributing factors include increases in patient volume and a shorter average length of stay for patients.
High labor costs remain an ongoing problem threatening providers’ bottom lines, according to new data from Kaufman Hall. The research revealed that medical groups’ median investment in each employed physician has reached more than $300,000 for the first time.
Health systems' financial results suggest the start of sustained recovery, but persistent challenges remain, including rising expenses and less-than-ideal reimbursement rates from payers.
Many healthcare providers saw their revenues and operating margins grow in July, despite the fact that both labor and non-labor expenses continue to grow, according to new data.