- Advocate Aurora Health will implement a rate increase, effective Jan. 1, at its medical centers in Wisconsin that will boost total patient gross revenue by 5% on an annualized basis, a spokesperson for the Midwest hospital system told Healthcare Dive Tuesday in an email.
- Advocate Aurora said the decision to raise prices was driven by continued market and industry challenges compounded by inflation, inadequate reimbursement rates and ripple effects from COVID-19.
- The system’s labor, drugs and supply costs have gone up by more than 10% since last year, the spokesperson said.
Large health systems such as Advocate Aurora have been pummeled all year by rising labor costs that have strained finances. Hospitals have boosted salaries, benefits and merit pay for clinicians, while the use of nurse staffing agencies has driven up expenses.
Advocate Aurora, which also operates in Illinois, two weeks ago reported a net loss of $912 million for the first nine months of the year, as investment losses also dragged on its results.
Advocate Aurora medical centers in Wisconsin will increase the cost for hospital room stays in 2023 by 5.3% to 5.5%, depending on location, the Milwaukee Business Journal reported. Last year, price hikes for a hospital room in the Milwaukee area ranged from 4.3% to 5.3%, the report said.
Advocate Aurora this spring announced its intention to merge with Atrium Health, creating one of the nation’s largest nonprofit health systems. Advocate Aurora operates 27 hospitals in Illinois and Wisconsin, with annual revenue of about $14 billion. Atrium Health operates 40 hospitals across North Carolina, South Carolina, Georgia and Alabama and generates annual revenue of $13 billion.
The merger is subject to antitrust review but is expected to close before the end of this year, Advocate Aurora has said.