Tight ex­pense man­age­ment helps boost sur­plus at Sut­ter

Modern Healthcare - - REGIONAL NEWS - —Beth Kutscher

Sut­ter Health, a 24-hos­pi­tal sys­tem based in Sacra­mento, Calif., has con­tin­ued to im­prove its op­er­at­ing per­for­mance through the first nine months of the year, cut­ting ex­penses to over­come flat rev­enue growth.

Ad­mis­sions con­tin­ued to de­cline, de­creas­ing 4.2% in the third quar­ter. How­ever, the drop was off­set by a 2.3% in­crease in out­pa­tient rev­enue.

Lo­cated in a state that ex­panded Med­i­caid el­i­gi­bil­ity to adults up to 138% of the fed­eral poverty level, Sut­ter re­ported that its pro­vi­sion for doubt­ful ac­counts fell 50% in the first nine months com­pared with the year-ago pe­riod. Bad debt and char­ity-care write-offs also de­creased by an undis­closed amount. The sys­tem cut costs for pur­chased ser­vices and other ex­penses, while salary and ben­e­fits rose a mod­est 3%.

Sut­ter booked an op­er­at­ing sur­plus of $224 mil­lion on $7.2 bil­lion in rev­enue dur­ing the first nine months of the year, com­pared with an op­er­at­ing loss of $18 mil­lion also on $7.2 bil­lion in rev­enue dur­ing the prior-year pe­riod.

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