Hospital Financial and Operational Pressures Persist but Patient Care Metrics Remain Consistent, According to Latest Syntellis Performance Solutions Report

Total expenses climb for an 11th month as hospital reimbursements shrink

CHICAGO – May 5, 2023 – Syntellis Performance Solutionsthe leading provider of enterprise performance management software, data, and intelligence solutions, today released its monthly Syntellis Performance Trends-Healthcare report which highlights effects of persistent high expenses for the nation’s healthcare providers.

The latest data show that U.S. hospitals and health systems continue to face rising expenses, with March marking an 11th consecutive month of year-over-year (YOY) increases in both total expenses and total non-labor expenses. However, analysis indicates that rising costs do not appear to be affecting the level of care patients receive.

“Hospitals continue to endure intense financial and operational pressures, yet a deep dive into clinical data from hospitals nationwide suggests they remain unwavering in their commitment to provide consistent levels of patient care,” said Steve Wasson, Executive Vice President and General Manager for Data and Intelligence Solutions at Syntellis. “Despite shrinking reimbursements and relentless expense increases, healthcare organizations are finding ways to grow in-demand services and better manage high costs to ensure they do not compromise vital care for the communities they serve.”

According to the report, total hospital expenses (which include all labor and non-labor expenses) rose 4.7% YOY in March while total non-labor expenses rose 5.5% YOY due to higher costs for drugs, supplies, and purchased services. Labor expenses remain high, but growth in labor expenses slowed the first three months of 2023. Total labor expense was up 1.8% YOY in March, a slight uptick after labor expense increases eased to less than 1% in January and February. 

Zeroing in on operating rooms, medical supply costs rose significantly up 8.5% YOY in March, and up 13.5% over the two-year period from March 2021 to March 2023. However, clinical data reveal that trends in length of stay — which reflect the level of care patients receive by how many days they are in inpatient care — have stayed relatively stable for common procedures such as cesarean sections, heart stent procedures, and hip and knee replacement surgeries. 

Another source of hospital operating pressures is the widening gap between how much hospitals bill for their services and what insurance companies and other healthcare payers agree to pay, referred to as the “allowed” amount. Looking at imaging as an example, recent all-payer claims data show that billed amounts for common imaging procedures increased at a rate of up to two times more than the allowed amount. In summary, providers are being paid a smaller share of what they bill while expenses continue to climb.

Even with ongoing operating pressures, hospital margins saw some improvement in March, inching barely above zero for the first time in 15 months. The median, actual year-to-date Operating Margin was 0.4% for March, up from -1.1% in February. The slight upturn is a positive sign, but operating margins remain extremely thin and unsustainable long-term. Future months will show if improvements continue.

About the Data

The Syntellis Performance Trends report — issued monthly — uses data from Syntellis’ Axiom™ Comparative Analytics, which offers access to near real-time data drawn from more than 135,000 physicians from over 10,000 practices and 139 specialty categories, and from 500+ unique departments across more than 1,300 hospitals. Powered by Syntellis IQ, Axiom Comparative Analytics also provides data and comparisons specific to a single organization for visibility into how their market is evolving. This month’s report also features data from Syntellis’ Clinical AnalyticsTM and the Syntellis All-Payer Claims Data (APCD) - Longitudinal Claims database.

About Syntellis

Syntellis Performance Solutions provides innovative enterprise performance management software, data, and intelligence solutions for healthcare organizations. Its solutions include enterprise planning, cost and decision support, and financial and clinical analytics to elevate organization performance and transform vision into reality. More than 2,800 organizations and 450,000 users rely on Axiom, Connected Analytics, and Stratasan software. With an HFMA Peer Review designation for nearly a decade and No. 1 rankings from Black Book Research multiple years, running, Syntellis helps healthcare providers acquire insights, accelerate decisions, and advance their business plans. For more information, please visit

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Press Contact:
Cam Granstra
Syntellis Performance Solutions