Hospital PMI
The report was issued today by Nancy LeMaster, MBA, Chair of the Institute for Supply Management® (ISM®) Hospital Business Survey Committee: “The Hospital PMI® registered 52.3 percent in March, a 4.3-percentage point decrease from the February reading of 56.6 percent, indicating a seventh consecutive month of growth after a contraction in August.
Business Activity Index
The Business Activity Index expanded for the seventh consecutive month. The New Orders Index remained in expansion for the seventh straight month, and the Employment Index also stayed in expansion territory. The Supplier Deliveries Index remained in expansion (which indicates slower delivery performance). The Case Mix Index registered 51 percent, a decrease of 1 percentage point compared to the February figure of 52 percent. The Days Payable Outstanding Index contracted in March after expanding for five consecutive months, registering 49.5 percent, down 1 percentage point from the 50.5 percent reported in February. The Technology Spend Index reading of 57 percent is an increase of 3 percentage points compared to the 54 percent recorded in February. The Touchless Orders Index registered 52.5 percent, up 1.5 percentage points from the 51 percent reported in February.”
LeMaster continues,
“The revenue issues caused by the Change Healthcare cybersecurity breach were top of mind for several Hospital Business Survey Committee respondents. The incident impacted health systems of all sizes. Although the Days Payable Outstanding Index contracted slightly in March, panelists from affected systems indicated expanded payment terms will be sought to help cope with cash flow issues. There was no consensus on volume growth in the month. Some respondents indicated surgical volumes were down at their facilities, while others indicated volumes were steady. There were multiple mentions of mergers and acquisitions used to increase volumes versus organic growth rates. Back orders and product substitutions continued but received less attention than in previous months. Some panelists noted ongoing efforts to replace contract labor with permanent employees, while there was also mention of continued pressures to limit hiring whenever possible.”
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Hospital PMI® History |
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Month |
Hospital PMI® |
Month |
Hospital PMI® |
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Mar 2024 |
52.3 |
Sep 2023 |
57.0 |
|
Feb 2024 |
56.6 |
Aug 2023 |
47.5 |
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Jan 2024 |
61.5 |
Jul 2023 |
53.3 |
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Dec 2023 |
62.5 |
Jun 2023 |
51.5 |
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Nov 2023 |
59.8 |
May 2023 |
49.1 |
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Oct 2023 |
52.1 |
Apr 2023 |
55.3 |
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Average for 12 months – 54.9 High – 62.5 Low – 47.5 About This ReportThe information compiled in this report is for the month of March 2024.The Hospital PMI® was developed in collaboration with the Association for Health Care Resource & Materials Management (AHRMM), an association for the health care supply chain profession, and a professional membership group of the American Hospital Association (AHA). The data presented herein is obtained from a survey of hospital supply executives based on information they have collected within their respective organizations. ISM® makes no representation, other than that stated within this release, regarding the individual company data collection procedures. The data should be compared to all other economic data sources when used in decision-making. Data and Method of Presentation The Hospital PMI® is a composite index computed from the following, equally weighted indexes: Business Activity, New Orders, Employment and Supplier Deliveries. Diffusion indexes have the properties of leading indicators and are convenient summary measures showing the prevailing direction of change and the scope of change. A Hospital PMI® index reading above 50 percent indicates that the hospital sub-sector is generally expanding; below 50 percent indicates that it is generally declining. For the sub-indexes, except Supplier Deliveries, an index reading above 50 percent indicates that the sub-index is generally expanding; below 50 percent indicates that it is generally contracting. A Supplier Deliveries Index above 50 percent indicates slower deliveries and below 50 percent indicates faster deliveries. The Hospital ISM® Report On Business® survey is sent out to the Hospital Business Survey Committee respondents the first part of each month. Respondents are asked to ONLY report on U.S. operations for the current month. 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