Most hospitals lose money on operations

57.0% of the 5,774 hospitals with a Medicare cost report and a bed count ran an operating loss in their latest fiscal year. Fiscal years in the snapshot end between January 2023 and September 2024. The median operating margin is negative 2.6%.

Size does not save you. Under 50 beds, 62.6% lost money on operations. 400 beds and up, 58.9%. The best bracket is 50 to 199 beds at 51.0%, still a coin flip.

Total margin tells a different story. Only 33.9% ran a negative total margin and the median total margin is positive 4.3%. The gap is investment income, grants, tax revenue and other money that does not come from treating patients. Large hospitals lean on it hardest: 58.9% lose on operations but only 20.5% lose overall.

Sell into a hospital and you are selling to a buyer whose core business loses money more often than not. The capital committee knows it. A proposal that shows an operating effect, not only a clinical one, meets them where the pressure is.

Cite this: Most hospitals lose money on operations, ProxiSuite (2026), based on CMS Hospital Cost Report (HCRIS) snapshot. https://proxisuite.com/report/hospitals-operating-loss.html

ProxiSuite is not endorsed by or affiliated with any government agency. Analysis based on public federal data.