Denver sys­tem’s rev­enue up, op­er­at­ing in­come down

Modern Healthcare - - REGIONAL NEWS - —Beth Kutscher

SCL Health Sys­tem, which has pruned its port­fo­lio of hos­pi­tals dur­ing the past year, re­ported an in­crease in 2013 rev­enue but lower op­er­at­ing in­come be­cause of higher ex­penses.

In a fi­nan­cial fil­ing for its fis­cal 2013, ended Dec. 31 Denver-based SCL re­ported a sur­plus (which in­cludes re­turns on fi­nan­cial as­sets), of $188.6 mil­lion on rev­enue of $2.3 bil­lion. That rep­re­sented an im­prove­ment from a sur­plus of $180.6 mil­lion on rev­enue of $2.2 bil­lion the prior year.

How­ever, op­er­at­ing in­come fell to $41.4 mil­lion in 2013 from $56.7 mil­lion the pre­vi­ous year as salaries, ben­e­fits and other ex­penses in­creased. Higher in­vest­ment in­come off­set the de­cline.

The Catholic sys­tem closed a deal in April 2013 to sell two of its Kansas hos­pi­tals to for-profit chain Prime Health­care Ser­vices. Six months later, SCL en­tered into an agree­ment to trans­fer spon­sor­ship of St. John’s Health Cen­ter in Santa Mon­ica, Calif., to Prov­i­dence Health & Ser­vices in a $125 mil­lion deal.

The sys­tem saw an 8.7% in­crease in pa­tient ser­vice rev­enue from Med­i­caid and a 12% in­crease in rev­enue from man­aged-care and commercial plans. Rev­enue from self-pay pa­tients also in­creased 13.2%, and the sys­tem pro­vided more char­ity care and recorded higher write-offs from bad debt. Ad­mis­sions fell 4.2% year over year.

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