July 7, 2022

Economic health of hospitals looks to be improving

By: Tarsilla Moura

Editor's Note

According to a report from the Institute for Supply Management (ISM), economic activity in the hospital subsector grew in June for the 25th consecutive month, Healthcare Purchasing News July 7 reports.

Following are some observations, according to Nancy LeMaster, MBA, ISM chair for the Hospital Business Survey Committee:

  • The Hospital PMI registered 58% in June, a 1.1% increase from the 56.9% increase noted in May.
  • The above increase indicates growth for the 25th consecutive month.
  • Most survey respondents reported a continued decline in COVID-19 cases.
  • Some reported “strong increases in elective procedures at some facilities and lower volumes at others.”
  • Supply chain disruptions continue to be a challenge, “with many panelists commenting on high volumes of product substitutions and challenges getting product from secondary suppliers.”
  • Inflation fueled higher prices, fuel surcharges increased, and “high wage rates and supply cost increases continue to put pressure on hospital margins.”

The Hospital PMI® covers ambulatory, inpatient and nursing home-type facilities, and it comprises 10 subindexes in the Non-Manufacturing ISM® Report On Business®, plus four others. Survey Committee respondents are asked to assess their organizations’ performance compared to the previous month—better/higher, same, or worse/lower. The data is converted into diffusion indexes that measure the direction and rate for each measurement. The Hospital PMI was developed in collaboration with the Association for Health Care Resource & Materials Management, an association for the healthcare supply chain profession, and a professional membership group of the American Hospital Association.


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