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.  

Top 10 hospitals with the highest net patient revenue growth percentile

Rank Hospital Type State NPR growth NPR growth percentile  Explore dataset
Hendrick Medical Center Hospital TX 5.57 99 Explore
United Memorial Medical Center Main  Hospital TX 5.00 99 Explore
PSN Affiliates  Health System TX 4.23 99 Explore
Inspira Medical Center Elmer  Hospital NJ 2.87 99 Explore
University of Michigan Health-West Hospital MI 2.03 99 Explore
Emory University Hospital Hospital GA 2.00 99 Explore
CHRISTUS Mother Frances Hospital - Sulphur Springs  Hospital TX 1.75 99 Explore
St Agnes Hospital Hospital WI 1.63 99 Explore
Trinity Health  Health System ND 1.39 99 Explore
10 UC Health West Chester Hospital Hospital OH 1.26 99 Explore

Fig. 1Data 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. 

Top 10 hospitals with the highest net operating margin percentile

Rank Hospital Type State Net operating margin Net operating margin percentile Explore dataset
Highland Hospital Hospital CA 15.43 99 Explore
St Mary Medical Center Hospital PA 14.09 99 Explore
Holy Family Memorial Medical Center Hospital WI 1.06 99 Explore
Methodist Hospital  Hospital IL 0.76 99 Explore
PSN Affiliates  Health System TX 0.73 99 Explore
UnityPoint Health Peoria Health System IL 0.70 99 Explore
Emory University Hospital Hospital GA 0.69 99 Explore
United Memorial Medical Center Main  Hospital TX 0.67 99 Explore
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.  

Top 10 hospitals with the highest day sales outstanding percentile

Rank Hospital  Type State Day sales outstanding  Day sales outstanding percentile Explore dataset
Highland Hospital Hospital CA -1314.26 99 Explore
Atlantic Health System Health System NJ -955.09 99 Explore
St Mary Medical Center Hospital PA -460.79 99 Explore
South Central Regional Medical Center Hospital MS -418.88 99 Explore
Larkin Community Hospital - South Miami Campus Hospital FL -318.95 99 Explore
Beckley ARH Hospital Hospital WV -162.12 99 Explore
AdventHealth Sebring Hospital FL -141.84 99 Explore
Larkin Community Hospital Health System Health System FL -136.75 99 Explore
Hospital San Carlos Borromeo Hospital PR -132.39 99 Explore
10 University Hospital Hospital MS -123.27 99 Explore

Fig. 3Data 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.  

Top 10 hospitals with the highest current ratio percentile

Rank Hospital Type State Current ratio Current ratio percentile Explore dataset
Children’s Healthcare of Atlanta Health System GA 305.24 99 Explore
MultiCare Tacoma General Hospital Hospital WA 233.80 99 Explore
MultiCare Allenmore Hospital Hospital WA 233.80 99 Explore
University Health Truman Medical Center Hospital MO 174.94 99 Explore
MultiCare Good Samaritan Hospital Hospital WA 161.80 99 Explore
Atrium Health University City  Hospital NC 124.41 99 Explore
Atrium Health Mercy Hospital NC 67.43 99 Explore
Atrium Health Pineville  Hospital NC 67.43 99 Explore
Texas Center for Infectious Disease  Hospital TX 58.94 99 Explore
10 Houston Methodist Baytown Hospital Hospital TX 49.23 99 Explore

Fig. 4Data 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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