Most Nonprofit Hospitals and Health Systems Had “Strong” Days of Cash on Hand in 2022, Though About One-in-10 Were “Vulnerable”


Most nonprofit hospitals and hospital systems had enough cash on hand in 2022 to cover operating expenses for an extended period of time, though about one-in-10 had relatively low levels to cover their expenses, which potentially could leave them vulnerable in a financial crisis, a new KFF analysis finds.

The analysis comes as the hospital industry pushes for increases in Medicare and Medicaid reimbursement levels and Congress considers legislation that would reduce hospital revenues, such as through site-neutral payment reform. It looks at “days cash on hand” at 274 nonprofit hospitals and health systems rated by S&P Global, which are estimated to collectively account for more than half of all nonprofit hospitals and about two thirds of nonprofit beds. The measure is one of several that S&P Global uses to assess hospitals’ financial health and determine their credit rating. Those with more days of cash on hand are better able to weather financial challenges, such as low operating margins.

The analysis finds:

  • Nearly three-quarters (73%) of nonprofit hospitals and health systems analyzed had at least “strong” levels of cash on hand based on the S&P’s standard definitions – enough to cover at least 150 days of expenses for health systems or 160 days of expenses for stand-alone hospitals.
  • An additional one-in-six (18%) had “adequate” levels of cash on hand – enough to cover 100-150 days for hospital systems or 110-160 days for stand-alone hospitals.
  • About one-in-10 (9%) analyzed hospitals and health systems had fewer days of available cash on hand, which the ratings agency considers “vulnerable” or “highly vulnerable.” 
  • The total share of non-profit hospitals and health systems with “vulnerable” or “highly vulnerable” levels of days cash on hand may be larger, since the as the S&P data analyzed underrepresents groups that are more likely to face financial challenges, such as small and rural hospitals.
  • Across all analyzed hospitals and hospital systems, the average levels of days cash on hand stood at 218 days in 2022, similar to the levels in 2019 but down from a recent peak during the early years of the COVID-19 pandemic.

TheMost Nonprofit Hospitals and Health Systems Analyzed Had “Adequate” or “Strong” Days of Cash on Hand in 2022, Though About One in Ten Did Not is available as part of KFF’s expanding work examining the business practices of hospitals and other providers, and their impact on costs and affordability.



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