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Financial updates from 28 health systems: HCA, Mayo & more

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Financial updates from 28 health systems: HCA, Mayo & more

Health systems recently reported financial results for the third quarter and first nine months of the year, with many making positive strides with their turnaround strategies on the back of some challenging financial years due to the COVID-19 pandemic. 

Here are 28 health systems that recently released financial results:

1. Chicago-based CommonSpirit reported an adjusted operating loss of $291 million on revenue of $8.9 billion for the first quarter of fiscal 2024, ending Sept. 30. The adjusted figure compares with an operating loss of $227 million in the same period last year with revenue of $8.5 billion. Salaries and benefits increased $174 million or 3.9% over the prior-year period. The overall net loss for the 142-hospital system totaled $738 million as CommonSpirit reported net investment losses of $289 million.

2. Livonia, Mich.-based Trinity Health reported an operating loss of $58.6 million in the first quarter of the fiscal year — the three months ended Sept. 30 — compared to a $146.3 million loss during the same period in 2022. Operating revenue for the quarter increased 12.4% year over year to $5.6 billion while expenses rose 10.3% to $5.7 billion. Overall for the three-month period, Trinity posted a $211.5 million net loss, compared to a $565 million loss for the same period last year.

3. Irving, Texas-based Christus Health, a 60-hospital system, reported $324.5 million in operating income in fiscal year 2023, which ended June 30, up from a $286.4 million operating gain in the previous fiscal year. Revenue increased 6.1% year over year to $7.8 billion while expenses rose 5.8% to $7.5 billion. Under expenses, Christus’ employee compensation and benefits increased 1.8% year over year to $3.5 billion and supply costs grew by 9.3% to $1.3 billion. Labor cost per adjusted discharge decreased 7.6%. Christus ended FY 2023 with a net income of $409.2 million, up from $210 million the previous year. 

4. Oakland, Calif.-based Kaiser Permanente reported $156 million in operating income for the third quarter, up from a $75 million operating loss in the third quarter of 2022. For the three months ended Sept. 30, Kaiser’s health plan, hospitals and their respective subsidiaries posted $24.9 billion in revenue and $24.7 billion in expenses, compared to $24.3 billion and $24.3 billion, respectively, in the same period of the prior year. Net income for the third quarter was $239 million, up from a net loss of $1.5 billion in the third quarter of 2022.

5. Nashville, Tenn.-based HCA Healthcare, a 183-hospital system, reported an operating income of $1.63 billion in the third quarter, a 4.1% drop from the $1.7 billion reported in the third quarter of 2022. Revenues in the third quarter totaled $16.21 billion, compared to $14.97 billion in the third quarter of 2022, while expenses hiit $14.58 billion, up from $13.27 billion. For the nine months ending Sept. 30, HCA revenues totaled $47.67 billion and expenses hit $42.30 billion, compared to $44.74 billion and $39.46 billion, respectively, in the same period in 2022. Net income hit $3.64 billion, up slightly from $3.56 billion in the prior-year period. 

6. Franklin, Tenn.-based Community Health Systems reported $173 million in third-quarter net income, down from $204 million in the same period last year. CHS had net operating revenues of $3.09 billion in the quarter, up 2% over the same period last year. On a same-store basis, net operating revenues increased 5.1% in the three months ended Sept. 30. The system posted a $91 million net loss in the third quarter, down from a net loss of $42 million over the same period last year. For the nine months ended Sept. 30, CHS reported a net loss of $180 million, compared to a loss of $369 million over the same period last year. 

7. Dallas-based Tenet Healthcare reported $568 million in third-quarter operating income, down from $596 million in the prior-year period. The operating margin for the three months ending Sept. 30 was 11.2%, or $568 million, compared with 12.4% in the same period, or $596 million, in 2022. Net income for the period totaled $101 million on revenue of $5.1 billion, compared with a net income of $131 million on revenue of $4.8 billion in the third quarter of 2022. 

8. King of Prussia, Pa.-based Universal Health Services posted an operating gain of $285.4 million in the third quarter, up from $275.9 million in the third quarter of 2022. Revenue increased 6.8% year over year to $3.6 billion. Expenses in the third quarter hit $3.3 billion, up from $3.1 billion in the third quarter of 2022. Net income for the period was $167 million, compared with $182.8 million during the third quarter of 2022.

9. Renton, Wash.-based Providence posted a $310 million operating loss in the third quarter, down from a $164 million loss in the same period last year. Despite a 5% year-over-year increase in third-quarter revenue, the 51-hospital system’s overall performance was affected by a 7% increase in expenses — largely driven by wage increases, higher supply costs and higher costs to serve patient volumes. EBIDA was $104 million — the fifth consecutive quarter of positive results — and net operating losses were $310 million. Investment losses drove $71 million in non-operating losses in the quarter.

10. Rochester, Minn.-based Mayo Clinic reported an operating income of $302 million in the third quarter, up from $157 million in the same period last year. Third-quarter revenue increased 8.2% year over year to $4.5 billion while expenses rose 4.8% to $4.2 billion. Net income for the third quarter was $21.1 billion, compared with $16.6 billion in the same period in 2022.

11. Pittsburgh-based UPMC reported a $177 million loss on revenues of $20.6 billion for the nine months ending Sept. 30, compared with a $196 million gain on revenues of $18.9 billion during the same period in 2022. Operating margin for the year was -0.9% as of Sept. 30, compared with 1% for the nine-month period last year. Year over year for the nine-month period, revenues for the 35-hospital system increased 9.3% to $20.6 billion while expenses grew by 11.4% to $20.8 billion. As of Sept. 30, 2023, unrestricted cash and investments over long-term debt decreased $181 million compared to Dec. 31, 2022. Days in accounts receivable at Sept 30, 2023, and Dec. 31, 2022, were 43 and 45, respectively. 

12. Charlotte, N.C.-based Advocate Health posted operating income of $79.4 million in the first nine months of 2023. The 67-hospital system, formed after Charlotte-based Atrium Health merged with Advocate Aurora Health, posted $721.2 million of excess revenue over expenses in the three quarters ended Sept. 30. Advocate Health posted $22.83 billion in revenue, with expenses hitting $22.75 billion over the nine-month period. It has seen a $625.7 million return on investment in the first nine months of the year.

13. Phoenix-based Banner Health posted $149.4 million in operating income on revenues of $10.3 billion for the nine months ending Sept. 30, compared with a $113.2 million operating loss on revenues of $9.3 billion for the same period in 2022. Year over year for the nine-month period, revenues increased 11.2% to $10.3 billion while expenses grew by 8.2% to $10.2 billion. The 30-hospital system ended the nine-month period with a net income of $425.3 million, compared with a net loss of $839.1 million during the same period last year. 

14. Salt Lake City-based Intermountain Health reported $157 million in operating income on revenues of $11.9 billion for the nine months ending Sept. 30, compared to a $285 million operating gain on revenues of $10.2 billion for the same period in 2022. Year over year for the period, Intermountain’s operating margin decreased by 1.5% to 1.3%, revenues increased 16.4% to $11.9 billion and expenses increased 18.2% to $11.2 billion. The health system ended the nine-month period with a net income of $912 million, down from $2.2 billion in the prior-year period.

15. New Hyde Park, N.Y.-based Northwell Health reported a $11.6 million operating loss in the third quarter, compared to a $92.4 million gain in the third quarter of 2022. Revenue increased 5.8% year over year to $4.1 billion while expenses increased 8.6% to $4.2 billion. Under expenses, salaries increased 11.3% to $2.2 billion and employee benefits were up 8.8% to $454 million. Northwell’s net income and net margin for the nine months ending Sept. 30, were $449.2 million and 3.5%, respectively, compared to a net loss and net margin of $1.2 billion and 11.6% for the prior-year period. 

16. Cleveland Clinic reported a $14.9 million operating loss in the third quarter of 2023, compared with a $28.3 million loss during the same period in 2022. The health system saw revenues of $3.6 billion in the quarter, up from $3.3 billion in the prior-year period, while expenses increased to $3.4 billion from $3.1 billion. Salaries, wages and benefits increased 8.1% in the third quarter, compared to the same period in 2022. Supply expenses increased 11.6% over the same period last year and pharmaceutical costs increased 21.1%. Overall for the quarter, Cleveland Clinic posted a $127.4 million net loss, a substantial improvement on the $469.2 million loss it posted in the same period last year. 

17. Chicago-based Northwestern Medicine posted $352.3 million in operating income during fiscal year 2023, a 5% increase on the $335.8 million it reported in the previous fiscal year. Total revenue increased 9.2% year over year to $8.7 billion while expenses rose 9.4% to $8.4 billion. Under expenses, salaries increased 11.1% to $528.2 million and supplies increased 11% to $1.9 billion. The 11-hospital system ended FY 2023 with an overall gain of $1.1 billion, a significant improvement on the $688.6 million net loss it reported last year. 

18. Peoria, Ill.-based OSF HealthCare reported an operating income of $1.2 million in its FY 2023, which ended Sept. 30, compared with a $115 million operating loss in FY 2022. Revenue was $4.1 billion in FY 2023, up by $269.4 million or 7.1% over the prior year. Expenses for the year were $4.1 billion, increasing by $153.3 million or 3.9% over FY 2022. After factoring in nonoperating items, the 15-hospital system reported $323.8 million in net income, compared with a loss of $426.7 million in FY 2022. 

19. St. Louis-based Mercy, the sixth largest Catholic healthcare system in the country, topped $8 billion in revenue in its latest fiscal year and reported operating income of $11.8 million.The $8.02 billion revenue figure for the year ending June 30 and positive operating income compared with revenue of $7.5 billion and an operating loss of $13.6 million in 2022. Salary expenses rose 5.3% to total $4.56 billion. Net income totaled $104.4 million, compared with an overall loss of $299.3 million in 2022.

20. Nashville, Tenn.-based Vanderbilt University Medical Center reported operating income of $28 million in the first quarter of the fiscal year, compared to an $11 million operating loss in the prior-year period.In the fiscal first quarter, operating revenue increased 11% year over year to $1.8 billion while expenses rose 9% to $1.77 billion. After factoring in the performance of its investment portfolio and other nonoperating items, Vanderbilt ended the quarter with a bottom line gain of $45 million, compared to a $17 million net loss in the first quarter of FY 2023. 

21. Greenville, S.C.-based Prisma Health transformed a $67.6 million operating loss in fiscal year 2022 into a $67.1 million gain in FY 2023. Revenue increased 5.8% year over year to $6 billion and expenses rose 3.4%. Though labor costs increased in FY 2023, Prisma said the spike was mitigated by decreased length of stay and reduced contract labor. Prisma reported a net gain of $268.3 million compared to the prior year loss of $418.4 million, resulting in an excess margin of 4.3% and -7.8%, respectively.

22. San Diego-based Scripps Health reported a $36.6 million operating loss in FY 2023, down from an operating gain of $49.3 million in the previous fiscal year. Revenue increased 4.1% year over year to $4.3 billion while expenses rose 6.3% to $4.3 billion. The four-hospital system ended the 2023 fiscal year with a net gain of $335.2 million, a significant improvement on the $502.9 million loss it reported the previous year. 

23. Boston-based Mass General Brigham posted a $48 million operating loss for the fiscal year ending Sept. 30, a significant improvement on the $432 million loss reported last year. The $48 million loss excludes one-time revenues largely related to federal transfers connected to the pandemic. Operating revenue was $18.8 billion in FY 2023, increasing 12% over 2022. Operating expenses increased 9% year over year to $18.7 billion. The five-hospital system reported an overall gain of $1.2 billion in the fiscal year, compared to an overall loss of $2.3 billion in the previous fiscal year. 

24. Providence, R.I.-based Lifespan Health posted $8.6 million in operating income in FY 2023 after seeing a $56 million loss in 2022. Patient service revenues increased by $227.9 million (9.6%) in 2023 while discharges increased by 5.3%, resulting in a $166.1 million patient revenue boost. Expenses increased by $224.2 million (7.8%) due primarily to increases in compensation and benefits of $131.5 million (7.5%) and supplies and other expenses of $90.4 million (12.1%). After factoring in nonoperating items, Lifespan reported an overall gain of $37.3 million, compared to a $186.8 million deficit last year. 

25. York, Pa.-based WellSpan Health reported an operating loss of $5.8 million in the fiscal year first quarter, down from an $11.6 million gain in the same period last year. Quarterly revenue increased 3.3% year over year to $928 million and expenses rose 5.3% to $933.8 million. The eight-hospital system ended the three-month period with a net loss of $42.9 million, a 49% improvement on the $84.1 million loss it posted in the same period last year. 

26. Greensburg, Pa.-based Independence Health System, formed when Excela Health and Butler Health System merged Jan. 1, reported operating losses of $22.7 million on operating revenue of $261.8 million for the three months ending Sept. 30. These losses are close to the operating loss predictions for the fiscal year ending June 30, 2024, the publication reports. Butler reported $13.5 million in operating losses for 2022, $40.7 million for 2023, and $13.1 million in the first quarter of 2024. Excela saw $9.7 million in operating losses for the three months ending Sept. 30, up from $2 million in losses last year. Operating as subsidiaries of Independent Health, the two systems are reporting their financial results separately for bond reporting requirements. 

27. New York City-based Montefiore Health System saw its operating margins improve to -0.5% for the nine months ending Sept. 30, up from -2.6% for the same period last year. Year over year for the nine-month period, revenue increased 8.4% to $5.61 billion and expenses increased 6.8% to $5.64 billion. Its operating loss for the nine-month period was $28.6 million in 2023, compared with $136.1 million in the prior-year period. The 10-hospital system ended the nine-month period with a net loss of $21.2 million, compared with a net loss of $308.5 million for the same period in 2022.

28. West Reading, Pa.-based Tower Health continues to make progress on its performance improvement plan as its operating margin for the three months ended Sept. 30 rose to -4.2% from -8% during the same period in 2022. Its operating cash flow margin also increased from -0.9% to 2.3%. During the first quarter of fiscal 2024, revenue decreased 2.9% year over year to $457.4 million. Expenses decreased 6.4% to $476.5 million. Tower’s operating loss for the period was $19.1 million, compared with a loss of $37.6 million for the prior-year period. The health system ended the three-month period with a net loss of $20.9 million, compared with a net loss of $37.6 million for the same period in 2022.

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