QSS: Strong Health Services Revenue Growth in 2nd Quarter

Census2This morning’s Quarterly Services Survey showed strong revenue growth in health services. Overall, revenues grew 3.6 percent in Q2 versus Q1 and 6.7 percent versus Q2 2015. For the first half, revenues grew 5.9 percent versus H1 2015. Growth was positive in all sectors except specialty hospitals. Physicians’ offices led the growth, at 4.5 percent. This is a turnaround from Q1. Perhaps most surprising was medical and diagnostic labs, for which revenue grew 4.0 percent. Labs have shed jobs, so increasing revenue suggests productivity improvements.

See Table I below the fold:


It looks like health services establishments continue to outperform the rest of the economy, corroborating other economic data discussed at this blog.

For the second quarter in a row, profitability in tax-exempt hospitals has increased dramatically. Net revenue per inpatient day increased 25 percent to $562 and net revenue per discharge increased 24 percent to $3,043. This was driven by top-line revenue growth, while inpatient days and discharges shrank a little (Table II).


Taxable hospitals’ profits shrank a little, but they are still higher than tax-exempt hospitals’ are, both in margin and dollars.

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