Healthcare Insights
Top 10 hospitals with the greatest financial strength
With healthcare spending generating nearly 20% of the Gross Domestic Product in the U.S., it’s crucial to understand how hospital finances work. Financial strength is a major indicator of hospitals’ overall financial health.
Financial strength is a business’s ability to invest, pay dividends and repay debts with its profits. There are many different financial health metrics, such as profits, total assets, equity ratio and operating costs. Financial strength metrics indicate companies’ current and future financial state.
Why is financial strength important to healthcare?
Financial strength is a critical way to measure the finances of hospitals. Financial strength can also reflect healthcare organizations’ financial priorities by showing growth and profit.
Definitive Healthcare leverages hospital financial data to interpret healthcare organizations’ financial health. We determine the financial strength of hospitals as a measure of their net patient revenue (NPR) growth, net operating margin, day sales outstanding (DSO) and current ratio data.
See below for the hospitals with the greatest financial strength broken into four separate metrics. The lists provided here focus on hospitals with over 50 beds and those that provided these metrics to be featured.
| Rank | Hospital | Type | State | NPR growth | NPR growth percentile | Explore dataset |
|---|---|---|---|---|---|---|
| 1 | Hendrick Medical Center | Hospital | TX | 5.57 | 99 | Explore |
| 2 | United Memorial Medical Center Main | Hospital | TX | 5.00 | 99 | Explore |
| 3 | PSN Affiliates | Health System | TX | 4.23 | 99 | Explore |
| 4 | Inspira Medical Center Elmer | Hospital | NJ | 2.87 | 99 | Explore |
| 5 | University of Michigan Health-West | Hospital | MI | 2.03 | 99 | Explore |
| 6 | Emory University Hospital | Hospital | GA | 2.00 | 99 | Explore |
| 7 | CHRISTUS Mother Frances Hospital - Sulphur Springs | Hospital | TX | 1.75 | 99 | Explore |
| 8 | St Agnes Hospital | Hospital | WI | 1.63 | 99 | Explore |
| 9 | Trinity Health | Health System | ND | 1.39 | 99 | Explore |
| 10 | UC Health West Chester Hospital | Hospital | OH | 1.26 | 99 | Explore |
Fig. 1 Data is from Definitive Healthcare’s Hospitals database. Data accessed February 2022.
What is net patient revenue (NPR) growth?
Net patient revenue growth is the increase in net patient revenue. NPR is the hospital revenue, or total funds, collected from patient services. When NPR is negative, a healthcare organization’s discounts are more than its revenue. High NPR growth is best, as it indicates a more significant increase in money from patient services, year after year.
What is the average net patient revenue (NPR) growth?
The average net patient revenue growth is 2.77. Each hospital is in the 99th percentile for net patient revenue growth, indicating that they all performed 99% better than other hospitals in terms of NPR growth. As the table shows, the top three hospitals by NPR growth are in Texas. This makes sense given that Texas has the second-largest economy in the U.S.
| Rank | Hospital | Type | State | Net operating margin | Net operating margin percentile | Explore dataset |
|---|---|---|---|---|---|---|
| 1 | Highland Hospital | Hospital | CA | 15.43 | 99 | Explore |
| 2 | St Mary Medical Center | Hospital | PA | 14.09 | 99 | Explore |
| 3 | Holy Family Memorial Medical Center | Hospital | WI | 1.06 | 99 | Explore |
| 4 | Methodist Hospital | Hospital | IL | 0.76 | 99 | Explore |
| 5 | PSN Affiliates | Health System | TX | 0.73 | 99 | Explore |
| 6 | UnityPoint Health Peoria | Health System | IL | 0.70 | 99 | Explore |
| 7 | Emory University Hospital | Hospital | GA | 0.69 | 99 | Explore |
| 8 | United Memorial Medical Center Main | Hospital | TX | 0.67 | 99 | Explore |
| 9 | United Memorial Medical Center | Health System | TX | 0.67 | 99 | Explore |
| 10 | St Agnes Hospital | Hospital | WI | 0.66 | 99 | Explore |
Fig. 2 Data is from Definitive Healthcare’s Hospitals database. Data accessed February 2022.
What is net operating margin?
Net operating margin is the revenue after paying non-operating and operating business expenses and before paying tax or interest. Typically, a high operating margin is best since it indicates profitability from sales and operational efficiency.
What is the average net operating margin?
The average net operating margin is 3.55. Each hospital making this list is in the 99th percentile for net operating margin, indicating that they all performed 99% better than other hospitals in terms of net operating margin.
| Rank | Hospital | Type | State | Day sales outstanding | Day sales outstanding percentile | Explore dataset |
|---|---|---|---|---|---|---|
| 1 | Highland Hospital | Hospital | CA | -1314.26 | 99 | Explore |
| 2 | Atlantic Health System | Health System | NJ | -955.09 | 99 | Explore |
| 3 | St Mary Medical Center | Hospital | PA | -460.79 | 99 | Explore |
| 4 | South Central Regional Medical Center | Hospital | MS | -418.88 | 99 | Explore |
| 5 | Larkin Community Hospital - South Miami Campus | Hospital | FL | -318.95 | 99 | Explore |
| 6 | Beckley ARH Hospital | Hospital | WV | -162.12 | 99 | Explore |
| 7 | AdventHealth Sebring | Hospital | FL | -141.84 | 99 | Explore |
| 8 | Larkin Community Hospital Health System | Health System | FL | -136.75 | 99 | Explore |
| 9 | Hospital San Carlos Borromeo | Hospital | PR | -132.39 | 99 | Explore |
| 10 | University Hospital | Hospital | MS | -123.27 | 99 | Explore |
Fig. 3 Data is from Definitive Healthcare’s Hospitals database. Data accessed February 2022.
What is day sales outstanding (DSO)?
Day sales outstanding is the average number of days a company receives payment after a sale. Generally, a low DSO is best since it reflects that a company collects its payments efficiently, making more funds available.
What is the average day sales outstanding?
The average day sales outstanding is -416.43. Each hospital making this list is in the 99th percentile for day sales outstanding, indicating that they all performed 99% better than other hospitals in terms of DSO.
| Rank | Hospital | Type | State | Current ratio | Current ratio percentile | Explore dataset |
|---|---|---|---|---|---|---|
| 1 | Children’s Healthcare of Atlanta | Health System | GA | 305.24 | 99 | Explore |
| 2 | MultiCare Tacoma General Hospital | Hospital | WA | 233.80 | 99 | Explore |
| 3 | MultiCare Allenmore Hospital | Hospital | WA | 233.80 | 99 | Explore |
| 4 | University Health Truman Medical Center | Hospital | MO | 174.94 | 99 | Explore |
| 5 | MultiCare Good Samaritan Hospital | Hospital | WA | 161.80 | 99 | Explore |
| 6 | Atrium Health University City | Hospital | NC | 124.41 | 99 | Explore |
| 7 | Atrium Health Mercy | Hospital | NC | 67.43 | 99 | Explore |
| 8 | Atrium Health Pineville | Hospital | NC | 67.43 | 99 | Explore |
| 9 | Texas Center for Infectious Disease | Hospital | TX | 58.94 | 99 | Explore |
| 10 | Houston Methodist Baytown Hospital | Hospital | TX | 49.23 | 99 | Explore |
Fig. 4 Data is from Definitive Healthcare’s Hospitals database. Data accessed February 2022.
What is current ratio?
Current ratio is a company’s ability to pay short-term obligations with existing assets. Current ratios are relative to industry standards, with a current ratio in line with or slightly above the standard being best.
What is the average current ratio?
The average current ratio is 147.70. Each hospital making this list is in the 99th percentile for current ratio, indicating that they performed 99% better than other hospitals in terms of current ratio.
Overall, hospital financial strength intelligence can help healthcare organizations understand their and their competitors’ financial health. It can also help healthcare organizations monitor their finances, create hospital financial reports and optimize processes. Companies can utilize hospital financial health intelligence to target which hospitals have the propensity for services and products.
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