According to the the latest Hospital ISM Report on Business from the Institute for Supply Management, economic activity in the hospital subsector grew in June after one month of contraction preceded by 35 consecutive months of growth.

“The Hospital PMI registered 51.5% in June, a 2.4-percentage point increase from the May reading of 49.1%, indicating a return to growth after one month of contraction,” Nancy LeMaster, MBA, chair of the ISM’s hospital business survey committee, said. “The Business Activity Index increased compared to May. The New Orders Index returned to expansion territory, and the Employment Index continued to indicate contraction. The Case Mix Index was unchanged in June; the reading of 50% is down three percentage points compared to the May figure of 53%. The Days Payable Outstanding Index returned to expansion territory at 51.5 %, up 5.5 percentage points from the 46% reported in May. The Technology Spend Index reading of 52% is an increase of point five percentage point compared to the 51.5% recorded in May. The Touchless Orders Index reading of 51.5% is an increase of 1 percentage point compared to the May figure of 50.5%.

“With increases in business activity and new orders, the Hospital PMI returned to expansion territory. Business Survey Committee respondents commented on increased elective procedure volumes and revenue growth. However, they cautioned that those gains were offset by inflationary factors on labor and supply costs. The prices: supplies and prices: pharmaceuticals indexes have been in ‘increasing’ territory for 43 and 63 consecutive months, respectively. The resulting margin pressures have some organizations freezing some positions or laying off personnel. There continues to be a shortage of clinical personnel, and competition for experienced employees remains intense. The Supplier Deliveries Index set a record in June, with a fifth consecutive month in ‘faster’ territory. Despite this, panelists commented on continued back orders within segments of the medical device supply chain. They also commented that drug shortages were worse than supply shortages.”