What explains the growth in hospital assets from 2000 through 2019? A decomposition analysis

Understanding disparities in hospital finances is essential for ensuring equitable systems of care. One understudied element is total assets, which include both financial and capital resources that hospitals acquire. We evaluated changes and drivers of variation in US hospital assets from 2000 through 2019 using data from the Centers for Medicare and Medicaid Services and American Hospital Association Annual Survey. We decomposed overall variation in total assets to determine the level (hospital, health system, or health care market) that contributed most to variation, and examined the extent to which asset growth was associated with changes in common inputs to hospital wealth vs changing relationships with these inputs or other unmeasured factors. Total assets held by US hospitals increased from $750 billion in 2000 to $1.6 trillion in 2019. Most variation occurred between hospitals, such that high-asset hospitals tended to remain high-asset and low-asset hospitals remained low-asset. Most of the increase in assets was due to unmeasured factors (ie, not patient revenue). We conclude that hospital wealth in the form of assets has grown substantially over time and accrued primarily to wealthy hospitals. Policymakers should consider broader measures of hospital wealth when targeting financial resources and efforts to strengthen data on hospital financing.