Hospital Administrator: Salary, Jobs, Challenges, and Trends

Written by
Crystal Shoaie
Reviewed by
Miranda Kay, RN
May 21, 2024

Workforce shortages. Financial management. Patient safety. 

The hospital administrator handles all this and manages the shift towards value-based care and new technologies. Read on to learn about the pay range, typical jobs, relentless challenges, and compelling trends.

How Much Does a Hospital Administrator Earn?

The mean annual wage for hospital administrator jobs in the United States is $127,980 or $61.53 per hour. However, this is the mean; pay typically ranges from $64,100 to over $209,990 for the top-earning 10 percent. The table below lets you easily compare hospital administrator wages in the seven most common job settings.

Table 1: Job Setting, Number of Healthcare Administrators Employed Nationwide, and Mean Annual Wage

Setting # of Healthcare Administrators Employed Mean Wage
General Medical and Surgical Hospitals 137,410 $139,490
Offices of Physicians 61,740 $126,210
Outpatient Care Centers 36,350 $122,870
Nursing Care Facilities 26,120 $103,800
Other Ambulatory Health Care Services 8,560 $101,820
Specialty (except Psychiatric and Substance Abuse) Hospitals 8,300 $140,200
Psychiatric and Substance Abuse Hospitals 5,360 $116,340

Besides the work setting, geographical location substantially affects a hospital administrator’s salary. The highest-paying states for this profession—with mean salaries over $145,000—are listed below.

Now that you know the typical pay scale, you may wonder what healthcare administration jobs are available.

What Are Some Typical Hospital Administration Jobs?

A small hospital may have one executive hospital administrator who takes on several managerial roles. In contrast, a larger hospital may have managers or professionals for each role working under the senior hospital administrator. Other healthcare organizations such as long-term care facilities, home health care, or outpatient care centers also offer healthcare administrator jobs.

Executive Hospital Administrator

Senior healthcare executives or hospital CEOs usually have previous experience in department management, finance, human resources, or information systems. They also may have experience as assistant hospital administrators. As healthcare CEOs, they coordinate the work of departments within an organization and define long-term strategy. Executives must be able to share the larger picture of the organization effectively, including its future vision, current mission, and critical strategy—and apply it all to the ever-present challenges. To do this, they need to learn to motivate their personnel, share and discuss complex ideas in both writing and presentations, communicate one-on-one with health practitioners from diverse backgrounds, and help employees at all levels reach their goals.

Department Director

Managing clinical units (med-surg, telemetry, emergency room (ER), intensive care unit (ICU), pediatrics, and many others) or administrative departments (for example, medical records, human resources, or finance) provides valuable experience and learning to become a senior hospital administrator. 

A clinical or administrative department director oversees day-to-day operations and staff management, fosters team building, develops and maintains a budget, ensures and monitors high-quality services and care, establishes effective communication systems, safeguards and verifies compliance with both legal requirements and institutional policy, provides training, and much more.

Data Analyst

Data analysts can guide efforts to streamline operations and improve patient outcomes by discovering analytical insights from data found in electronic health records, billing history, prescriptions, lab results, and patient vitals. 

With mastery of the computer programming language and a working knowledge of machine learning, they oversee hospital data management and analytics, standardize the data-gathering process, and organize and optimize the output. With the advantage of synthesized information from appropriate sources, healthcare systems can proactively address the needs of populations, reduce unnecessary expenditures, and proceed with well-informed business plans.

Finance Manager

Finance managers help accomplish sustainable growth by providing expert budgeting and data analysis support. They also report on performance and formulate investment proposals. In the healthcare industry, this role is critical in meeting intensive legal requirements and financial strategy, which may enable groundbreaking research or implementation of new data collection and evaluation technologies.

Safety Manager

Safety managers devise, implement, and monitor programs to protect patients and staff, minimize reporting errors, and maintain high-quality service. They establish policies to promote a culture of health and safety, conduct training sessions, investigate accidents and risks, and are responsible for quality management. 

Risk and Compliance Manager

Risk and compliance managers apply their knowledge of legal requirements to refine policies, design and deliver training, and look into potential violations. Since healthcare organizations are subject to an enormously complicated array of federal and state regulations guarding the health and privacy of patients, risk management can go beyond enforcing legal compliance to addressing areas of potential liability within an organization. 

What Does It Take to Become a Hospital Administrator?

These jobs and roles often overlap and benefit from open communication, coordination, and teamwork. For managerial healthcare jobs, you will need to develop skills in communication, staff management, problem-solving, decision-making, negotiation, delegation of authority, goal-setting, data analysis, policy development, and leadership. A master’s program in hospital administration develops such capacities.

Master’s in Hospital Administration (MHA) Overview

An MHA blends the fields of healthcare and business, covering subjects essential to executive and managerial positions. An MHA degree usually requires between 36 and 45 credits and takes two to three years. Students can complete intensive programs in as little as 15 to 16 months.

Significant Challenges Healthcare Administrators Face

According to the American College of Healthcare Executives’ annual survey, the top challenge in 2023 was the ongoing healthcare personnel shortage, with financial stress coming in second.

Clinician Shortage

Recruitment takes up a significant portion of hospital administrators’ and managers’ time, so many hospitals employ recruitment professionals. 

Several statistics reveal the extent of the ongoing healthcare personnel crisis. According to the American Hospital Association (AHA), about 100,000 registered nurses left the workforce in 2021–2022 due to stress, burnout, and retirement, and an additional 610,388 stated an intent to leave nursing by 2027. According to the National Council of State Boards of Nursing (NCSBN), this reduction represents a 3.3 percent decline in the US nursing workforce. Furthermore, according to the American Medical Association, the US faces a projected shortage of 37,800 to 124,000 physicians by 2034.

A practical avenue to deal with urgent gaps in personnel is found on virtual healthcare platforms, such as Nursa, which connects hospitals and other healthcare facilities with per diem nurses and nursing assistants.

Financial Pressure

Good news! The heavy strain from workforce shortages, inflation, and the pandemic on the healthcare industry’s financial health is slowly easing. 

By January 2022, hospital operating margins had plunged to -3.3 percent, building back up to a positive 0.9 percent by March 2023 and reaching over 2 percent in January 2024, according to the Kaufman Hall Operating Margin Index, a measure of the profitability of hospitals. Despite this median, 40 percent of American hospitals continue to suffer a deficit in 2024.

Much of the improvement results from transformation efforts—technological innovation and combining traditional and digital healthcare—undertaken in recent years by healthcare delivery providers. Healthcare payers (commercial and private insurance companies, Medicaid, Medicare, and other government-funded insurance plans) are taking action to accelerate payment. 

Technology

Technology is a top-three priority for 56 percent of providers, and 75 percent plan spending growth in the next twelve months. Grappling with complex technology needs, considering options, integrating carefully selected solutions into facilities, and providing technological training and support to the personnel have become common challenges for hospital administration. It is a steep learning curve for administrators and clinicians.

Constantly improved tech tools and artificial intelligence (AI) streamline hospital administrative workloads and patient flows, reduce wait times, predict busy hours or days for staff scheduling, and help detect diseases like cancer earlier and with greater precision, not to mention the transparency and access to health records and data brought about by electronic health records.

Shift to Value-Based Care (VBC)

Value-based care consists of care models and reimbursement programs that reward providers based on patient outcomes and other specific measures, such as reducing hospital readmissions, using certified health IT, and improving preventative care. In contrast, the more traditional fee-for-service (FFS) healthcare compensation charges for healthcare services.

The Medicare Access and CHIP Reauthorization Act (MACRA), passed in 2015, fundamentally altered reimbursement by gradually adopting value-based billing systems.

A McKinsey study predicts that the number of patients in VBC models will grow from 80 million in 2022 to 160 million in 2027, requiring health systems to upgrade their risk-bearing capabilities.

Redesigning financial models that require administrators to negotiate value-based contracts with payers, managing potential revenue fluctuations associated with the transition, and meeting complex payer requirements are just the beginning of the many challenges of this shift.

Opioid Crisis

The Nation is in the midst of an unprecedented opioid epidemic. Over 136 people a day die from opioid-related overdoses.

Hospital administrators get hit with this issue from both sides, bearing the brunt of treatment for people overcoming addiction and overdoses and being called to account for getting many of those individuals hooked on the drugs in the first place.

Whether by instituting better controls over drugs or finding alternative pain management therapies, administrators struggle with the opioid crisis. They train their staff, educate patients and their families, and implement system-level strategies for timely and effective prevention, identification, and treatment of opioid use disorder.

Irresistible Trends

Hospital administrators increasingly follow these three growing trends, which are changing healthcare.

  1. The financial pressure, combined with the clinician shortage, drives the trend to leverage technology to digitize communications, automate administrative tasks, and reduce paperwork, leading to more efficient workload management and time for patient care. 
  2. Increased technological awareness and savvy lead to more and more patients opting for telehealth and remote monitoring, seeking digital convenience and availability, and healthcare systems are adapting to meet these changing expectations.
  3. Major retail chains with ambulatory care, such as CVS Health MinuteClinics, Walgreens Healthcare clinics, and RiteAid RediClinics, also bring urgent and primary care to neighborhood drug and grocery stores, and they need and employ healthcare administrators.

To read more healthcare news, check out our article about the ban on noncompetes.

Nursa supports healthcare clinicians and administrators, offering vital connections and sharing insights into the challenges, trends, and transformations in the demanding world of healthcare. In particular, hospital administrators and staffing managers can use Nursa to post PRN jobs and fill gaps in clinician schedules. 

Sources:

Crystal Shoaie
Blog published on:
May 21, 2024

Meet Crystal, a contributing copywriter for Nursa who specializes in writing topics that help nursing professionals navigate the world of finances, education, licensing, compliance, equality, and ideal locations for per diem jobs.

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