The Minnesota Hospital Association (MHA) today released its annual report examining the financial health of Minnesota’s hospitals and health systems. The report examines publicly available fiscal year (FY) 2017 data – the most recent available – that hospitals and health systems are required to submit to the Minnesota Department of Health (MDH) each year.  

While many financial indicators are relevant to a thorough analysis of financial health, a hospital’s operating margin is the most recognizable bottom-line measure of whether a hospital can continue to meet patient and community needs. 

In general, Minnesota hospitals’ operating margins improved in 2017. Since 2013, the trend of overall median hospital operating margin in Minnesota has remained steady at just over 2 percent. The statewide median operating margin moved to 2.3 percent in 2017 – a positive signal that Minnesota’s hospitals and health systems have managed costs prudently to match lower revenue expectations. 

While 56 of Minnesota’s hospitals and health systems shown on this report generated positive operating margins in 2017, MHA noted that 26 hospitals, or 31 percent of hospitals and health systems statewide, experienced negative operating margins. This number compares with 29 showing negative operating margins in 2016.  

Historically Minnesota’s urban hospitals have had higher margins than rural hospitals; however, the gap has narrowed in recent years. The median operating margin for urban hospitals was 2.8 percent, down slightly from 3 percent in 2016. For rural hospitals, the median operating margin was 2.1 percent, up slightly from 2 percent in 2016. 

Read the full report. 

The Minnesota Hospital Association represents 142 hospitals and health systems, which provide quality care for their patients and meet the needs of their communities. 

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