From VMG Health, by Jordan Tussy, Colin McDermott, Madi Whyde:
VMG Health’s analysis of 2024 healthcare sector trends, based on earnings calls from various companies, suggests continued growth in utilization driven by patient backlogs, recovering macroeconomic trends, and an aging population. Key findings include:
- Medical Equipment Suppliers and Distributors: Companies like Intuitive Surgical, Inc., Stryker Corporation, and Cardinal Health, Inc. reported strong demand and growth in 2023, driven by higher system utilization and robust demand for capital products. They expect these trends to continue into 2024.
- Healthcare Operators: Operators like HCA Healthcare and Tenet Healthcare Corporation echoed the growth in utilization, particularly in the fourth quarter of 2023. They expect continued volume strength and investment in their programs, with growth in key specialties like gastrointestinal (GI) and ear, nose, and throat (ENT) services.
- Payors: Payors like Humana Inc. and UnitedHealth Group noted higher-than-expected medical costs due to strong utilization, particularly in outpatient care for seniors, orthopedic, and cardiac procedures. They expect these trends to persist in 2024.
- 2024 Expectations: Companies expect the growth trends of 2023 to persist throughout 2024, driven by elevated backlogs, stabilizing macroeconomic trends, and an aging population. They anticipate continued strong demand, healthy patient activity levels, and robust capital markets.
In conclusion, VMG Health anticipates that 2024 will be a strong utilization year for healthcare service providers, although higher utilization may lead to increased medical claims for payors.