There is a growing recognition of the need to measure and report hospital financial performance. However, there exists little comparative financial indicator data specifically for Critical Access Hospitals (CAHs). CAHs differ from other hospitals on a number of dimensions that might affect appropriate indicators of performance, including differences in Medicare reimbursement, limits on bed size and average length of stay, and relaxed staffing rules. The purpose of this study is to develop comparative financial indicators specifically designed for CAHs using Medicare cost report data.

With the assistance of a technical advisory group of individuals with extensive experience in rural hospital finance and operations, twenty indicators were deemed appropriate for assessment of CAH financial condition. The study found CEOs found the indicators to be useful and the underlying formulas to be appropriate. The multiple years of data provide snapshots of the industry as a whole, rather than trend data for a constant set of hospitals.