Massachusetts hospitals boosted their profitability in fiscal 2025, but a trade group offered a cautionary note Monday due to federal policy changes that could upend the gains.
A new Center for Health Information and Analysis report also captures how much money hospitals are pouring into the use of temporary workers, a sore point for nurses who have gone on strike or are preparing to walk off the job as they push for higher wages.
The hospital health system here notched a median operating margin of 0.2% in fiscal 2025, compared to negative 2.7% in fiscal 2024. The system’s median total margin was 4.7% in fiscal 2025, and the CHIA report said total margins were “strongly influenced by non-operating margins during this period, which included approximately $1.5 billion in unrealized investment gains.”
CHIA’s definition of acute hospital health systems incorporates all consolidated health entities, including acute hospitals, non-acute hospitals and physician organizations.
Dan McHale, senior vice president of healthcare finance and policy at the Massachusetts Health and Hospital Association, attributed the latest financial picture to “critical state investments” and efforts among hospitals to prepare for evolving federal policies.
“While CHIA’s latest annual report shows most hospital systems were operating on thin or negative margins in FY25, providers are now bracing for a historically challenging road ahead,” McHale said in the MHA’s newsletter Monday. “Major increases in uncompensated care, restrictions on fundamental financing supports, and growing administrative demands will collectively present the most disruptive wave of financial pressures hospitals have experienced. They come with alarming implications for not just provider organizations, but for patient access and affordability.”
CHIA officials acknowledged the improved overall financial performances but executive director Andrew Jackmauh noted that “a number of providers remain under financial stress.”
The uninsured rate is expected to double as a result of the One Big Beautiful Bill Act, while costing the state around $3.5 billion annually once all healthcare provisions of the federal law take effect, Audrey Shelto of the Blue Cross Blue Shield of Massachusetts Foundation said last November. The Health Safety Net Fund is also facing further strain, though Gov. Maura Healey proposed a new healthcare stabilization fund within a $2.24 billion supplemental budget last week.
Out of 23 health systems included in the CHIA report, 17 had positive total margins and 13 had positive operating margins. Boston Medical Center Health System recorded the biggest total loss of $144.4 million, while Mass General Brigham brought in the largest total profit of nearly $2.4 billion.
Worcester-based UMass Memorial Health Care reported a total loss of $22.8 million, while Tenet Healthcare Corp., operator of hospitals including Saint Vincent Hospital in Worcester and MetroWest Medical Center in Framingham and Natick, reported a total profit of $1.4 billion. Heywood Healthcare in Gardner, which exited bankruptcy in 2024 a year after filing for Chapter 11 in 2023, reported a total profit of $9.8 million.
Acute hospitals saw their aggregate expenses increase by $4.6 billion from fiscal 2024 to fiscal 2025. Aggregate workforce spending — including salary and benefits, plus temporary labor costs — climbed by $1.5 billion.
Temporary labor costs decreased from $935 million in fiscal 2024 to $762.3 million in fiscal 2025. Acute hospitals spent $351.7 million on temporary registered nurses in fiscal 2025, representing about 46% of all temporary staffing costs.
Expenses tied to temporary labor could spike once CHIA assesses the current fiscal year, particularly the toll of the historic nurse strike at Brigham and Women’s Hospital.
More than 4,000 Brigham nurses went on strike on July 8 after months of unsuccessful collective bargaining sessions to seek cost-of-living increases, affordable health insurance, limits on the use of temporary travel nurses and protections around patient care. Their intended one-day strike turned into a five-day work stoppage as the Brigham tapped temporary staff as part of its contingency planning.
During the strike, MGB said it brought on nearly 1,300 nurses who received “extensive orientation.” MGB said it contracted with agencies to “provide fully licensed nurses and clinicians with the appropriate experience and expertise to fully support the operational areas active during the stoppage.”
The Massachusetts Nurses Association, which represents the Brigham nurses, accused the hospital of hiring “unqualified” replacement nurses that “jeopardized patient safety.”
Brigham nurses last week voted to authorize an open-ended strike as the contract negotiation stalemate continues, and Boston Medical Center nurses also recently voted to approve a three-day strike. The Brigham notched a total profit of $525.2 million last fiscal year, while Boston Medical Center made $18.5 million, according to the CHIA report.
BMC-Brighton, a hospital formerly known as St. Elizabeth’s Medical Center that the state seized by eminent domain during the Steward Health Care bankruptcy, posted a total loss of $91.5 million last fiscal year.
Holy Family Hospital, which was also salvaged amid the Steward crisis, posted the highest acute hospital total margin of 27.4%. Merrimack Health, the rebranded system encompassing Lawrence General Hospital and Holy Family Hospital’s campuses in Haverhill and Methuen, had the highest total margin — 11.5% — among multi-acute health systems. CHIA noted both entities “received state funding and one-time revenues related to Merrimack Health’s acquisition of Holy Family Hospital.”
WBJ Managing Editor Eric Casey contributed to this article.Â
Alison Kuznitz is a reporter for State House News Service and State Affairs Pro Massachusetts. Reach her at akuznitz@stateaffairs.com.
