Financial updates for Cleveland Clinic, Sutter + 9 other health systems

https://www.beckershospitalreview.com/finance/financial-updates-for-cleveland-clinic-sutter-9-other-health-systems.html

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The following 11 health systems recently released financial updates:

1. Naples, Fla.-based NCH Healthcare System saw its revenue and net income improve in the 2018 fiscal year. The health system ended fiscal 2018 with net income of $37.3 million, up 45.3 percent from $20.4 million reported in the year prior.

2. Salt Lake City-based Intermountain Healthcare saw its revenues and operating income improve in fiscal year 2018. After incorporating nonoperating income, which was $240.2 million lower than the year before, Intermountain ended fiscal 2018 with net income of $598.5 million. That’s down 8.6 percent from $655.1 million reported in fiscal 2017.

3. Boston-based Dana-Farber Cancer Institute‘s revenue climbed 11.5 percent year over year to $487.2 million in the first quarter of fiscal year 2019. After factoring in a $31.6 million investment loss, Dana-Farber recorded a net loss of $1.2 million in the first three months of fiscal 2019. That’s compared to the first quarter of fiscal 2018, when the hospital recorded net income of $46.1 million.

4. Bronx, N.Y.-based Montefiore Medical Center saw operating revenue increase in 2018 but ended the period with a lower overall operating margin. After factoring in nonoperating gains and losses, the medical center recorded net income of $26.6 million for 2018, down 52.9 percent year over year from net income of $56.5 million.

5. Renton, Wash.-based Providence St. Joseph Health saw operating revenue increase in fiscal year 2018 but ended the period with a net loss. After factoring in investment losses, Providence St. Joseph ended 2018 with a net loss of $445 million compared to net income of $780 million the year prior.

6. Cleveland Clinic‘s revenue increased in 2018, but the system’s operating income and net income declined year over year. After factoring in nonoperating losses, Cleveland Clinic ended 2018 with net income of $103.9 million, down 91 percent from $1.2 billion in the year prior.

7. Trinity Health recorded higher revenue in the first half of fiscal year 2019 than in the same period of the year prior, but the Livonia, Mich.-based health system ended the first two quarters of the current fiscal year with a net loss. After factoring in nonoperating losses of $419.6 million, including investment losses due to turbulent financial markets, Trinity reported a net loss of $301.5 million in the first half of fiscal 2019. That’s compared to the first six months of fiscal 2018, when the system posted net income of $806.4 million.

8. Quorum Health‘s revenue declined year over year in the fourth quarter of 2018, and the Brentwood, Tenn.-based company ended last year with a net loss. After factoring in expenses and one-time charges, Quorum ended the fourth quarter of 2018 with a net loss of $20.7 million, compared to a loss of $26.8 million in the same period of the year prior. Looking at full-year results, Quorum’s net loss widened from $114.2 million in 2017 to $200.2 million in 2018.

9. Sacramento, Calif.-based Sutter Health reported its first annual loss in 23 years due to investment losses caused by turbulent financial markets in the fourth quarter of 2018 and recognizing less revenue from the California Hospital Fee Program. Sutter reported a net loss of $198 million in 2018, compared to net income of $893 million in the year prior.

10. Columbia, Md.-based MedStar Health saw its revenue increase in the first half of fiscal year 2019, but ended the six-month period with a net loss due to the investment markets’ unfavorable performance. After including nonoperating results, MedStar ended the first half of fiscal 2019 with an $87.5 million net loss, compared to net income of $171.5 million in the first half of the prior year.

11. Philadelphia-based Temple University Health System saw its financial position improve in the six months ended Dec. 31. TUHS ended the six-month period with an operating loss of $26.2 million, compared to an operating loss of $39.1 million in the six months ended Dec. 31, 2017.

 

Ascension and Providence St. Joseph Halt Merger Talks

http://www.healthleadersmedia.com/leadership/ascension-and-providence-st-joseph-halt-merger-talks?utm_source=edit&utm_medium=ENL&utm_campaign=HLM-Daily-SilverPop_03292018&spMailingID=13219554&spUserID=MTY3ODg4NTg1MzQ4S0&spJobID=1362682914&spReportId=MTM2MjY4MjkxNAS2

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The two Catholic systems seemed like a good pair, but the details thwarted their potential union. Perhaps the timing just wasn’t right.

Had the potential merger between Ascension and Providence St. Joseph Health been finalized, the combined Catholic system would have surpassed HCA Healthcare as the largest hospital operator in the country.

But the two organizations halted their discussions about the deal, as The Wall Street Journal reported Wednesday, citing unnamed sources. The talks are not expected to resume any time soon.

“A merger of this magnitude may have been too big for either to handle while still amalgamating their own constituent parts,” Mark Cherry, principal analyst at Market Access Insights for Decision Resources Group, told HealthLeaders Media in an email.

 

“Ascension is only now putting common branding on its operations in Wisconsin, Michigan, and other states, while PSJ’s operations remain very region-focused,” he added.

News of the halted talks comes after Ascension said this week it would sell St. Vincent’s Medical Center in Bridgeport, Connecticut, to Hartford HealthCare. Last month, Ascension signed a definitive agreement to add Presence Health’s 10 hospitals to AMITA Health, a joint venture by its Alexian Brothers Health System and Adventist Midwest Health.

Providence St. Joseph, meanwhile, formed less than two years ago with the combination of Providence Health & Services and St. Joseph Health System.

So both systems are “still working out redundancies and efficiencies from their own earlier mergers,” Cherry said.

The Journal reported that Ascension’s directors backed “a new strategic direction to boost growth and labor productivity,” which was among the reasons cited for the proposed merger falling through. That could mean Ascension wanted to eliminate jobs, while Providence St. Joseph didn’t, Cherry said.

Ascension was already expected to cut about 600 jobs in Michigan, as The Detroit News and other outs reported earlier this month, citing a memo sent to employees.

All of this coincides with a flurry of M&A activity among major players in the hospital sector, including large Catholic systems.

After a year of negotiations, Catholic Health Initiatives and Dignity Health announced their merger plans in December. A merger between Advocate Health Care and Aurora Health Care received final regulatory approval this month, and a separate merger is in the works between Mercy Health and Bon Secours.