In­vest­ments res­cue Inova Health from post­ing 2016 oper­at­ing loss

Modern Healthcare - - REGIONAL NEWS - —Dave Barkholz

A $265 mil­lion in­vest­ment gain in 2016 off­set a tough oper­at­ing year at five-hospital Inova Health Sys­tem.

Though rev­enue jumped 10% last year to $3.3 bil­lion, Falls Church, Va.based Inova’s oper­at­ing in­come fell to $130.9 mil­lion be­fore spe­cial charges com­pared with $221.4 mil­lion in 2015, Inova’s au­dited year-end fi­nan­cials show.

In­come was af­fected by an in­crease in staffing, in­clud­ing more physi­cians.

Not-for-profit Inova also was hit with a $64.5 mil­lion charge for ter­mi­nat­ing its pen­sion plan and an­other $48.4 mil­lion charge to re­duce the book value of its InTo­tal Health Med­i­caid health plan ac­quired in De­cem­ber 2012.

InTo­tal com­peted for a new Vir­ginia pro­gram in 2016 that put the spe­cial needs Med­i­caid pop­u­la­tion in its own pro­gram so as to bet­ter man­age their care. But the plan wasn’t se­lected, a loss that “could re­sult in an an­nual pre­mium re­duc­tion of up to $40 mil­lion an­nu­ally” for InTo­tal Health, ac­cord­ing to the fi­nan­cial dis­clo­sure.

With the spe­cial charges, Inova’s 2016 oper­at­ing in­come to­taled $18 mil­lion com­pared with $221.4 mil­lion in 2015.

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