Radio Advisory 289: What are health systems doing in 2026? Results from our survey are in.
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Mar 10, 2026 Alex Kist, an Optum consultant on health system operations and growth, and Marisa Nives, an Advisory Board researcher who leads the Strategic Planner Survey, discuss 2025 performance and 2026 priorities. They unpack why revenue gains often fail to become margin, the role of operational excellence, throughput and referral capture, ambulatory and primary care growth, and where systems should focus resources and tech investment.
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Revenue Growth Often Fails To Raise Margin
- Revenue growth is widespread but does not reliably produce margin growth.
- 90% grew net patient revenue while only 60% grew operating margin, showing growth alone doesn't beat rising costs.
Make Operational Excellence Your Margin Foundation
- Prioritize operational excellence as the foundation for margin improvement.
- Focus on OR productivity, network integrity, and throughput since outperformers in these areas more often convert revenue into margin.
Reducing Contract Labor Drives Margin Conversion
- Labor cost reduction, especially lowering contract labor, differentiated systems that grew margin.
- Systems that cut labor costs by >5% were more likely to turn revenue growth into operating margin growth.