A ratings agency warned that nonprofit hospital finances may have topped out, a South Carolina system struggled to recover from a cyberattack, and two large deals advanced.
Fitch Ratings reported on August 12 that the median operating margin across 222 nonprofit hospitals and systems rose to 1.5% in 2025, from 1.1% in 2024, the third straight year of improvement. Sixty-seven percent posted positive margins, up from 64%. Labor costs fell to 52.6% of operating revenue from 53.5%, helped by slower wage growth and strong volumes. Even so, Fitch cautioned that 2025 may turn out to be a high point, with material pressure expected from 2027 as Medicaid enrollment declines under H.R.1 take hold. The agency also noted that sector-wide averages hide a widening gap: strong systems hold most of the gains, while lower-rated and Medicaid-dependent hospitals are the most exposed.
AnMed, the nonprofit system based in Anderson, South Carolina, was hit by a malware attack on July 26 that initially forced 83 facilities to close. As of August 5, 10 remained closed, and the MyChart portal and other systems were still offline. Emergency services stayed open throughout, and clinicians worked under temporary downtime procedures. AnMed said it was working with federal authorities to determine whether patient data had been exposed. The case is a reminder that ambulatory networks, not just hospitals, need tested downtime plans, and that recovery is measured in weeks.
Outside acute care, HCA completed its purchase of Texas MedClinic’s 40 urgent care sites in early August, bringing its CareNow network to more than 430 clinics.
Executive takeaway: Boards should test their organizations against Fitch's view by asking how liquidity and margins hold up under 2027 Medicaid losses, not 2025 results. Health systems pursuing mergers should expect state attorneys general to require binding, long-term commitments on services and investment.
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