Hospital financial report predicts stability, high cybersecurity costs for 2025

Editor's Note

Hospitals’ financial outlook is stable, although growth is slowing and certain costs are projected to increase, particularly for cybersecurity, according to two recent Becker’s reports on data from Moody’s Investor Services.

The first, published November 14 in Becker’s Hospital CFO Report, notes that “hospitals are facing a stable outlook as the median operating cash flow margin nears 7%,”  driven by higher reimbursements form commercial insurers next year as well as the adoption of state-directed pay programs. Next year Moody's projects around 60% of nonprofit hospitals to have a 6%-plus margin, compared with 40% in 2023 and 78% pre-pandemic.

However, labor costs and inflation will continue as pain points even amid a stabilizing workforce, noting that the Health & Human Services Administration projects the supply of healthcare employees will meet 94% of demand. Supply costs are likely to also stay high, particularly for drugs.

The second article covering the Moody’s data, published November 15 in Becker’s Health IT, focuses on Moody’s expectation for cybersecurity spending among hospitals to increase to the point of reaching 7% of the total technology budget next year, up from 5% in 2019. Risk-mitigation strategies will remain a priority, Moody’s predicts, including multi-factor authentication, strong incidence response plans, the purchasing of (increasingly expensive) cybersecurity insurance, and the maintenance of strong cash reserves.