MedPac Finds the Hospital Industry is on a More Stable Financial Footing Now

Recent financial metrics show improvement in hospital margins and operational stability, MedPAC’s recommendation to limit Medicare payment increases in 2027 could have significant implications. While hospitals overall show signs of financial improvement, including higher operating margins and reduced labor costs, challenges persist for safety-net hospitals and those serving large shares of low-income and Medicare patients. MedPAC is proposing the use of the Medicare Safety Net Index (MSNI) to better allocate funding to these hospitals, but concerns remain about whether current payment structures will ensure access to essential services, capital investments, and long-term stability for all hospitals. Read on to explore the full details of MedPAC’s recommendations, the state of hospital funding, and the future of care for underserved communities.

Source: MedPAC finds the hospital industry is on a more stable financial footing now, Nick Hut, HFMA, December 15, 2025; https://www.hfma.org/payment-reimbursement-and-managed-care/medpac-finds-the-hospital-industry-is-on-a-more-stable-financial-footing/ .