Health system operating margins dipped into the red to start the new year, decreasing to negative 0.6% as month-over-month revenue decreases outpaced expense declines, according to new data from Strata Decision Technology’s latest Strata Performance Trends report.

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Hospital revenues strengthened alongside outpatient volume growth, though gains were not sufficient to offset cost pressures at the system level. Gross operating revenue increased 11.1% YOY in December, driven by a 12.8% YOY increase in outpatient revenue and a 7.6% YOY rise in inpatient revenue. At the same time, hospitals also saw continued growth in uncompensated care, as bad debt and charity care increased 7.0% YOY.