Economic activity in the hospital subsector expanded in May for the 21st consecutive month and the 38th time in the last 40 months, according to the Hospital Report On Business by the Institute for Supply Management (ISM).
The report was issued by Nancy LeMaster, chair of the ISM hospital business survey committee.
“The Hospital PMI registered 52% in May, a 3-percentage point decrease from the April reading of 55%. The Business Activity Index remained in expansion territory for the seventh straight month. The New Orders Index was ‘unchanged’ in May, and the Employment Index was in expansion territory for the second consecutive month. The Supplier Deliveries Index expanded (which indicates slower delivery performance) for the second straight month,” LeMaster said. “The Case Mix Index returned to expansion territory in May, registering 53%, an increase of 3.5 percentage points from the reading of 49.5% reported in April. The Days Payable Outstanding Index returned to expansion in May, registering 51.5%, up 2.5 percentage points from the 49% reported in April. The Technology Spend Index reading of 59% is an increase of 2.5 percentage points compared to the 56.5% recorded in April. The Touchless Orders Index returned to expansion territory in May, registering 51.5%, up 2 percentage points from the reading of 49.5% reported in April.”
“Tariffs continue to be the top-of-mind concern for Hospital Business Survey panelists. Some indicated they were taking a ‘wait-and-see’ approach, while others indicated they had increased purchases of equipment and supplies to reduce potential tariff impacts. Group purchasing organization (GPO) contracts that limit price increases over the length of the agreement were credited with preventing some increases, while other facilities began to experience higher prices,” LeMaster said. “Volumes were mixed, with some hospitals having strong elective procedure traffic and others showing a decrease relative to the previous month. Comments related to employment ranged from hospitals experiencing planned head-count reductions to others continuing to hire for clinical positions. Increases in inventory levels were attributed to planned buying related to tariff threats. There were limited concerns regarding supplier deliveries, product shortages or substitutions voiced in this month’s report.”
