National Daily Hospital News
Executive Briefing
Friday November 28th, 2025
>Margin Grows 2.9% But Gap Widens
>Health System Margin Around 1%
>Follow Ups Reduce Readmissions
>Recommendations and Case Studies
Global and Health Sector Headlines
(Today’s focus topic: Hospital Finance, Margin Pressure, and Performance Gaps)
News – Margin gap between top and bottom hospitals continues to widen
Hospital operating performance is diverging, with a recent 2025 analysis showing top-quartile hospitals at a 14.7% operating margin while bottom-quartile organizations remain at about -1.8%, underscoring widening financial risk for weaker systems.
https://www.healthcarefinancenews.com/news/financial-performance-gap-widens-between-top-bottom-hospitals-report-finds Healthcare Finance NewsNews – Median hospital margins inch up but remain fragile
A national review of 1,300 hospitals found that the operating margin index for 2025 to date is roughly 2.9%, only slightly above prior months, highlighting that one or two adverse shocks could push many hospitals back into the red.
https://www.fiercehealthcare.com/providers/topline-provider-performance-metrics-hold-steady-top-performers-buoy-struggling-hospitals Fierce HealthcareNews – Health system operating margins hover around 1% as non-labor costs rise
Strata Decision’s August 2025 data show U.S. health systems holding a national median operating margin of 1.0%, with modest revenue growth largely offset by persistent pressure from non-labor expenses such as drugs and purchased services.
https://www.stratadecision.com/press-release/us-health-system-operating-margins-hold-10-august-non-labor-expenses-continue-climb Strata Decision TechnologyNews – 2024 medians improved to 1.5%, but the runway is short
A Chartis analysis summarizing Moody’s 2024 hospital medians reports an increase in median operating margin from about 0.5% in 2023 to roughly 1.5% in 2024, driven by stronger volume and targeted cost actions, yet still too thin to comfortably fund capital and strategic growth.
https://www.chartis.com/insights/hospital-margins-trend-higher-looming-disruption-demands-strategic-decisions ChartisCase Study – Hospitals seeing modest margin improvements but persistent headwinds
A 2025 financial update describes hospitals achieving higher profit and operating margins along with a ~3% rise in patient volume and ~3% decline in length of stay, yet still facing challenges from workforce costs and reimbursement lags, illustrating how incremental efficiency gains can improve margins without fully resolving underlying structural issues.
https://acdis.org/articles/news-us-hospitals-see-positive-financial-developments-2025-challenges-remain-report-says ACDISGlobal Sector Example – Medtech turnaround highlights disciplined execution and R&D focus
Convatec’s transformation from low profitability to a projected 16% operating margin by 2025, achieved through portfolio focus, operational centralization, and more than doubled R&D investment, underscores how disciplined strategy and innovation can restore financial strength even in a heavily regulated health sector.
https://www.ft.com/content/334c8b8f-b95c-4c5a-a6b0-382c23e3dba9 Financial Times
Hospital Transitional Care, Readmissions, and Post-Stay Follow-Up
(Today’s second focus topic: Transitional Care Management and readmission reduction)
News – Transitional Care Management (TCM) visits reduce 30-day readmissions
A 2025 PLOS One study found that Medicare beneficiaries with a TCM follow-up visit after discharge had significantly lower 30-day unplanned readmissions (hazard ratio ≈0.74) compared with similar patients without TCM, and that patients cared for by clinicians who routinely use TCM codes also experienced fewer readmissions.
https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0316892 PLOSNews – Scheduling follow-up at discharge lowers readmissions for key conditions
An analysis of U.S. hospitals reported that scheduling an outpatient follow-up visit before discharge was associated with reduced 30-day all-cause readmissions among patients with heart failure, COPD, acute myocardial infarction, or stroke, reinforcing the operational value of embedding follow-up scheduling into discharge workflows.
https://www.cdc.gov/pcd/issues/2024/24_0138.htm CDCCase Study – Multidisciplinary HF transition clinics can cut readmissions (may require subscription)
A 2025 real-world study of a multidisciplinary heart failure transition-of-care clinic found that coordinated pharmacist, nursing, and physician follow-up for recently discharged HF patients significantly reduced 30-day readmissions, demonstrating the impact of structured transition pathways on high-risk populations.
https://www.sciencedirect.com/science/article/abs/pii/S014795632500041X ScienceDirectCase Study – DNP project highlights preventable nature of early HF readmissions
A doctor of nursing practice project on heart failure readmissions noted that an estimated 75% of early readmissions were preventable, with contributing factors including inadequate treatment, poor discharge planning, and limited patient education, making a strong case for standardized transitional care bundles.
https://scholarworks.uvm.edu/cgi/viewcontent.cgi?article=1155&context=cnhsdnp ScholarWorksNews / Case Study – Payer-led nurse transition teams for Medicare Advantage
CVS Health’s Aetna division is expanding a program that assigns Aetna-employed nurses to Medicare Advantage members at the bedside during hospitalization and through discharge, coordinating home services and transportation to follow-up visits to reduce readmissions ahead of CMS including MA enrollees in readmission penalty calculations.
https://www.reuters.com/legal/litigation/cvs-expand-program-aimed-reducing-hospital-readmissions-medicare-members-2025-09-22/ ReutersRecommendation – Transitional Care Management as a safety and cost strategy
A 2025 commentary from Loma Linda’s Institute for Health Policy & Leadership emphasizes that well-organized TCM programs—featuring medication reconciliation, coordinated follow-up, and patient education—can significantly reduce 30-day readmissions, improve patient safety, and lower overall costs, underscoring TCM as a core patient-safety strategy rather than just a billing opportunity.
https://ihpl.llu.edu/blog/transitional-care-management-ensuring-patient-safety Health Policy Institute
Early Morning Briefing Highlights
Margins remain razor-thin and highly uneven across hospitals
Recent national data show that while an aggregate 2025 operating margin index is around 2.9%, the spread from roughly 14.7% for top-quartile hospitals to -1.8% for the bottom quartile signals growing financial fragility for many community and safety-net providers.
https://www.healthcarefinancenews.com/news/financial-performance-gap-widens-between-top-bottom-hospitals-report-finds Healthcare Finance NewsNational median margins show only modest improvement despite heavy effort
Strata and Chartis reports together suggest median hospital and health-system operating margins clustered around 1.0–1.5%, indicating that gains from volume recovery and cost initiatives are real but still leave minimal buffer for capital renewal or major strategic bets.
https://www.stratadecision.com/press-release/us-health-system-operating-margins-hold-10-august-non-labor-expenses-continue-climb Strata Decision Technology+1TCM and proactive follow-up are among the strongest levers for readmission reduction
New evidence shows TCM visits and pre-scheduled outpatient follow-ups after discharge significantly reduce 30-day readmissions across common medical conditions, reinforcing the ROI of embedding transition protocols into daily discharge operations.
https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0316892 PLOS+1Payers are moving upstream into discharge planning
CVS/Aetna’s expansion of nurse-led bedside transition teams illustrates how payers are intervening earlier in the hospitalization episode to manage readmission risk, which may create both collaboration opportunities and new expectations for hospital care coordination.
https://www.reuters.com/legal/litigation/cvs-expand-program-aimed-reducing-hospital-readmissions-medicare-members-2025-09-22/ Reuters
Strategic Implications for Leadership
Segment your organization’s margin performance against national benchmarks
Compare your system’s operating margin by hospital and service line against recent national benchmarks (1.0–1.5% median, ~2.9% index, and the 14.7% vs -1.8% quartile spread) to identify which entities or services are effectively subsidizing others and where focused improvement is urgently needed.
https://www.chartis.com/insights/hospital-margins-trend-higher-looming-disruption-demands-strategic-decisions Chartis+1Treat TCM as a core quality program, not just a billing code
Based on new evidence that TCM visits reduce 30-day readmissions and that clinicians who consistently use TCM achieve better outcomes, leadership should sponsor a TCM optimization initiative—standardizing eligibility rules, workflows, documentation, and scheduling to ensure every qualifying patient receives a TCM follow-up.
https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0316892 PLOSInvest in multidisciplinary transition clinics for high-risk conditions
Emerging case studies of HF transition clinics show that pharmacist-, nurse-, and physician-co-managed programs can materially lower early readmissions, suggesting that similar models for COPD, AMI, and stroke may be justified, especially where readmission penalties and margin pressure intersect.
https://www.sciencedirect.com/science/article/abs/pii/S014795632500041X ScienceDirect+1Prepare for payer-driven expectations around discharge coordination
As payers like CVS/Aetna deploy nurses into hospitals to orchestrate post-acute care for Medicare Advantage members, executives should anticipate tighter scrutiny of discharge planning and may want to proactively define collaboration frameworks that align hospital workflows with payer programs while protecting staff time.
https://www.reuters.com/legal/litigation/cvs-expand-program-aimed-reducing-hospital-readmissions-medicare-members-2025-09-22/ ReutersFrame transitional care as a safety and equity imperative
Commentaries emphasize that TCM and structured transitions not only reduce readmissions and costs but also protect vulnerable populations from fragmented care, making it appropriate to elevate transitional care as a core patient-safety and health-equity initiative in your strategic plan.
https://ihpl.llu.edu/blog/transitional-care-management-ensuring-patient-safety Health Policy Institute
Quality Metrics to Share with Your Team (≤7)
Operating margin dispersion – A 2025 analysis shows top-quartile hospitals at approximately 14.7% operating margin versus about -1.8% for bottom-quartile hospitals, quantifying the widening performance gap leaders should track.
https://www.healthcarefinancenews.com/news/financial-performance-gap-widens-between-top-bottom-hospitals-report-finds Healthcare Finance NewsSystem-level operating margin index – Across roughly 1,300 hospitals, the 2025 operating margin index is about 2.9% year-to-date, indicating limited financial cushion for many organizations.
https://www.fiercehealthcare.com/providers/topline-provider-performance-metrics-hold-steady-top-performers-buoy-struggling-hospitals Fierce HealthcareHealth system median operating margin – Strata Decision reports a 1.0% national median operating margin for health systems in August 2025, reinforcing just how close to break-even many systems remain.
https://www.stratadecision.com/press-release/us-health-system-operating-margins-hold-10-august-non-labor-expenses-continue-climb Strata Decision TechnologyYear-over-year improvement in medians – Chartis notes that median hospital operating margin increased from about 0.5% (2023) to 1.5% (2024), demonstrating improvement but still leaving margins below pre-pandemic norms.
https://www.chartis.com/insights/hospital-margins-trend-higher-looming-disruption-demands-strategic-decisions ChartisTCM impact on readmissions – In a 2025 study, patients receiving a Transitional Care Management visit had a 26% relative reduction in 30-day readmissions (hazard ratio ≈0.74) compared with matched patients without TCM.
https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0316892 PLOSProvider TCM adoption effect – Among patients without a formal TCM visit, those seen by providers who frequently used TCM codes still had lower odds of 30-day readmission (odds ratio ≈0.84), suggesting that broader transition-oriented practice patterns improve outcomes even beyond coded TCM visits.
https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0316892 PLOSPreventable nature of early HF readmissions – A heart failure DNP project estimated that about 75% of early readmissions could be prevented through better treatment, discharge planning, and patient education, highlighting the improvement headroom in transition workflows.
https://scholarworks.uvm.edu/cgi/viewcontent.cgi?article=1155&context=cnhsdnp ScholarWorks
Leadership Call to Action (≤5 recommendations drawn from above)
Create a quarterly “margin gap” dashboard by hospital and service line
Build an executive dashboard that juxtaposes your organization’s margin performance against recent national medians and quartile benchmarks (1.0–1.5% medians, 2.9% index, 14.7% vs -1.8% spread) to focus capital and turnaround efforts where the risk is greatest.
https://www.fiercehealthcare.com/providers/topline-provider-performance-metrics-hold-steady-top-performers-buoy-struggling-hospitals Fierce Healthcare+1Implement a “TCM for every eligible discharge” policy
Direct care management, hospitalists, and ambulatory leaders to jointly design a process that automatically identifies TCM-eligible Medicare patients and schedules TCM visits within 7–14 days of discharge, with performance tracked as a core quality metric.
https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0316892 PLOSStand up multidisciplinary transition clinics for your highest-risk cohorts
Use readmission and penalty data to prioritize heart failure and one or two additional diagnoses (e.g., COPD or stroke) for multidisciplinary transition clinics, modeled on successful HF programs that have demonstrated meaningful reductions in 30-day readmissions.
https://www.sciencedirect.com/science/article/abs/pii/S014795632500041X ScienceDirect+1Align with payer-led readmission initiatives instead of competing with them
Engage payer partners launching nurse-led transition programs—such as the CVS/Aetna model—to co-design workflows that leverage payer resources while minimizing duplication and confusion for patients and hospital staff.
https://www.reuters.com/legal/litigation/cvs-expand-program-aimed-reducing-hospital-readmissions-medicare-members-2025-09-22/ ReutersReframe transitional care as a core safety and equity pillar in your strategic plan
Update your strategic plan and board scorecards so that TCM, follow-up scheduling, and patient education are explicitly tracked as patient-safety and health-equity measures, reflecting the evidence that robust transitional care programs improve outcomes and reduce disparities.
https://ihpl.llu.edu/blog/transitional-care-management-ensuring-patient-safety Health Policy Institute
📍 Published at National Daily Hospital News
#HospitalOps #CMS #HealthcareWorkforce #HospitalFinance #EmergencyServices #HospitalLeader #NursingExecutive #NursingLeader #EmergencyPhysician #Nursing #Hospitals #CaseManagement #EmergencyNurse
Published as part of the National Daily Hospital News series.
Visit the archive here: https://nationaldailyhospital.blogspot.com/
Connect with us:
LinkedIn: https://www.linkedin.com/in/spencetepper/
Facebook: https://www.facebook.com/Compirion
Number One Hospital Blog: https://bethenumber1hospital.blogspot.com/
© 2025 National Daily Hospital News
Principle Author: ChatGPT5
Editor: Spence Tepper
Permission to share freely given
No comments:
Post a Comment