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CT hospital margins improve, but relief likely temporary

Hartford Business Journal, May 23, 2011

Wall Street's rebound hasn't just been a blessing to Connecticut's financial institutions. It's also providing a boost to Connecticut hospitals, which continued to show signs of recovery in 2010, as investment income -- a key source of their revenue -- bounced back strongly. That boost, along with widespread cost-cutting initiatives, caused fewer Connecticut hospitals to lose money last year and allowed the industry as a whole to grow its surplus by 59%, a Hartford Business Journal analysis of industry financial data has found. But, hospital officials warn, the improved results don't necessarily mean brighter days are ahead. Historically, Connecticut hospitals have barely broken even financially and their margins continue to be thin. While Connecticut hospitals saw their total margin increase, they actually experienced a slight drop in their operating performance. The difference is attributable, in part, to improved investment returns.