CC Attribution-NonCommercial-NoDerivatives 4.0 International
The United States has a very unique healthcare system. The different layers of variance from care coordination, case management to utilization in all parts of healthcare makes the system really complex. With the continuous evolution in the healthcare system including changes in healthcare laws and payment methods, the profitability and financial sustainability of hospitals have become aspects of utmost importance not only to the hospitals but also to the people in general. My senior thesis focuses on the determination of the financial sustainability of hospitals. To understand that, I conducted a comparative analysis of profitability among different departments in a hospital with a comparison across the hospitals within Massachusetts. I focused specifically on 62 acute-care hospitals in Massachusetts. I collected the data from CHIA (Center of Health information and analysis) for the year of 2016 and 2017. I used the reports provided to trace the revenue and direct expenses of each department to evaluate their segment margins. Departments with significantly high segment margins reflect the true cost of healthcare that increases the overall cost of healthcare. The results revealed that some departments have higher segment margins than others and a few departments that seemed to be generating a lot of revenue had actually a very low segment margin.