Nonprofit hospitals face ongoing struggles in 2024

Editor's Note

The 2024 forecast for nonprofit hospitals is likely to remain challenging, according to the latest annual Fitch Ratings outlook, Chief Healthcare Executive December 6 reports

Some highlights of the report include: 

• The outlook for 2024, which was identified as “deteriorating,” is based on three ongoing challenges for nonprofit hospitals: staffing shortages, higher wages, and inflation. 
• The worst year for nonprofit hospitals was in 2022, and many did not return to a break-even point until later in 2023. 
• The rating outlook noted that these hospitals will likely struggle to get to healthier margins of 2.5% or 3% in 2024, and are likely to linger closer to 1%. 
• Significant issues remain staffing shortages and a reliance on contract workers as well as wage pressures from hospital unions in the wake of widespread healthcare worker strikes. 

Nonprofit hospitals that are likely to fare best in 2024 are those in areas with growing populations, the outlook noted.