Hospital fortunes improved heading into holidays

• Margins, or the percentage of revenue kept as profit, kept trending positive and facilities were able to reduce their reliance on costly contract labor where possible.

Yes, but: The numbers don't reflect the surge of seasonal respiratory illness that has since swamped many medical systems and taxed resources.

• More uninsured people from Medicaid redeterminations and continued congressional interest in overhauling Medicare payment policies could also complicate the outlook.

By the numbers: Inpatient and outpatient revenue increased year-over-year by 5% and 9%, respectively.

• Bad debt and charity care measured as a percentage of gross revenue was down 4%.
• Labor expense per adjusted patient discharge also was down 4% year-over-year, while drug spending per discharge was up 4%.

What we're watching: Some hospitals could seize the moment and launch expansions or embark on other growth strategies. But Kaufman Hall noted there's still a wide gap between the industry's high and low performers.