Dive Brief:
- Both nonprofit and for-profit PA hospitals are seeing their incomes drop, even though revenues are climbing.
- Operating income dropped 5% in fiscal year 2014 and operating margins dropped from 4.6% to 4.3%. Despite more than $40 billion in revenue growth statewide, operating expenses outpaced revenues.
- At the same time, three-year average total margins were positive for most hospitals.
Dive Insight:
"While the data shows many Pennsylvania hospitals experienced relatively healthy margins in fiscal year 2014, 34% lost money on operations and 28% lost money overall," Joe Martin, executive director of the Pennsylvania Health Care Cost Containment Council, told Healthcare Finance News.
Martin also said that "the continued growth of uncompensated care," which is currently at 2.8% of net patient revenues, "remains a major concern for Pennsylvania hospitals." He believes uncompensated care will decrease as Pennsylvania expands eligibility for Medicaid under a new Democratic governor.