Analysis of the Joint Distribution of Disproportionate Share Hospital Payments. Results


Table 5.3 summarizes the FY 1998 values for the financial indicators. Included is both a simple mean across all facilities and a discharge-weighted mean. For comparison purposes, we include the cut-off value for the 10th percentile of hospitals as well as the median value for hospitals with Standard and Poor bond ratings of BBB+/BBB/BBB-. The 10th percentile cut-offs are substantially below the median for the BBB rated hospitals. The latter are generally comparable to the median values for all hospitals.

Table 5.3
Summary of FY 1998 Financial Indicators
Measure Definition Unweighted Mean Discharge Weighted Mean 10th Percentile Median for BBB- rated hospitals*
Total margin (Net income [net patient revenue + other revenue - total operating expenses- other expenses]) / total revenues 2.1% 4.7% -9.51% 3.7%
Total margin net of DSH (Net income - DSH)/ (total revenues-DSH) 0.2% 1.9% -12.98% N/A
Current ratio total current assets/ total current liabilities 2.43 2.36 .89 1.96
Cash flow to total debt (net income + depreciation)/( total current liabilities + total long-term liabilities) .274 .294 -0.093 .171
Fixed asset turnover Net patient revenues/ total fixed assets. 2.56 2.21 1.13 2.16

* Source: CHIPS, 2001.

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