Clinical quality is independently associated with favorable bond ratings.

The relation between clinical quality and bond rating for nonprofit hospitals has been proposed but never fully studied. We analyzed the relation between bond rating, clinical quality measures (The Joint Commission/Centers for Medicare and Medicaid Services [CMS] core measures), and balance sheet and income statement financial measures of 236 hospitals across the United States that are rated by Moody's Investors Service and that reported clinical quality measures to CMS during the study period. We found a statistically significant relation between higher quality measures and more favorable bond ratings. This association remained significant after controlling for traditional financial parameters.

Comparing apples to apples: the relative financial performance of Manitoba's acute care hospitals.

This paper presents comparative financial ratios that can be adopted by health system administrators and policy analysts to begin to evaluate the performance of acute care hospitals. We combined financial, statistical and clinical information for 73 acute care hospitals in Manitoba for fiscal 1997/98 to calculate 15 indicators of financial performance. Our findings suggest that there is variability between hospital types in their average costs per weighted case, cost structure and financial performance.

The relative cost of inpatient care in Manitoba's largest hospitals.

Comparative information from 1991/92 to 1997/98 regarding an indicator of the relative financial performance of teaching, urban community and major rural hospitals in Manitoba is presented. Results suggest that the acuity and complexity of patients in teaching and urban community hospitals was similar in 1997/98, and that teaching facilities had higher inpatient care costs in all time periods, even after accounting for differences in case-mix, physician remuneration, capital expenditures and the direct costs of teaching programs.

Chasm grows between rich and poor. Top hospital performers get stronger as weaker competitors stumble, new research indicates.

Although recent studies show hospital operating margins dropped 45% in the fourth quarter of 1998, compared with the year-ago period, a new analysis of industrywide financial ratios reveals that the "average" hospital may be less representative of the whole. Instead, a chasm is widening around the median, with strong hospitals getting stronger and weak hospitals showing further decline.

How do you rate? Credit analysts now look at the big picture--where boards are front and center.

When it comes to health care bond ratings, financial factors aren't the only measures credit analysts are looking at these days. They also want to know why trustees and execs are making the decisions they do and if the board understands the health care industry and the strategies needed for future success.

A new perspective on hospital financial ratio analysis.

Using audit financial data in a study of 2,189 not-for-profit hospitals for the period 1989-1992, six financial characteristics of performance were defined. These characteristics are profitability factor, fixed-asset efficiency, capital structure, fixed-asset age, working capital efficiency, and liquidity. The statistical output also shows the specific sets of financial ratios that can be used to measure the six characteristics of hospital performance. The results of this study can be beneficial to healthcare financial managers, hospital boards, policy groups, and other relevant entities because it affords them a clear understanding of an institution's financial performance.

Necessary losses?

Hospitals and physician practices may for pricey partners: The median hospital-owned operation looses a sizable $57,000 a year. That number and others--compiled exclusively for H&HN by the Medical Group Management Association--beg big questions about how long hospitals can continue to subsidize unprofitable practices.

Differences in characteristics of hospitals with sustained high and sustained low profitability.

The organizational and operational characteristics of 140 private Florida hospitals with sustained high profitability and sustained low profitability were compared using pretax operating margin (PTOM) and pretax return on assets (PROA) measures. Approximately 15 to 20 percent of hospitals were defined as PTOM or PROA high-profit or low-profit for the years 1990, 1991, and 1992. The PTOM or PROA high-profit groups had a lower adjusted average length of stay and debt utilization, and a higher labor yield, occupancy rate, and percent with high hospital accreditation ratings (p < .05). In addition, the PROA high-profit group had a higher case-mix index and Medicare mix (p < .05). Characteristics that were different for high-profit and low-profit groups were within the scope of management.