Dive Brief:
- Nonprofit health system Ascension recorded a profit for the first half of its 2026 fiscal year, as the system focuses on expanding its ambulatory care network and growing its outpatient portfolio.
- Ascension earned $608 million in net income for the six-month period ended Dec. 31, 2025, more than double the $277 million notched in the prior-year period.
- It’s another earnings statement to reach the black after Ascension sustained years of losses exacerbated by increased expenses and a cyberattack that hit the system in 2024.
Dive Insight:
The Catholic health system has worked to realign its portfolio, prioritizing outpatient and ambulatory services and divesting inpatient facilities. It’s a strategy picking up momentum among hospital operators as they look to recoup more money in lower-cost outpatient settings, especially as healthcare policy headwinds loom that threaten to cut into health systems’ bottom lines.
In recent years, Ascension has divested dozens of hospitals, including those in New York and Illinois. Last year, the health system divested various senior care assets and its portfolio in southwest Michigan.
In tandem with its strategy, Ascension said in June it would acquire ambulatory surgery provider Amsurg. The deal, which was expected to close last year but has yet to do so, will add more than 250 ambulatory surgery centers to Ascension’s outpatient portfolio. Sources told Bloomberg that Ascension would pay almost $4 billion for the provider.
As of Dec. 31, Ascension owned 90 inpatient hospitals in addition to non-controlling stakes in 29 hospitals.
Divestitures and a migration of procedures to outpatient settings contributed to mixed volumes. Same-facility volumes remained relatively flat in the first half, increasing 0.2% year over year. Although Ascension said it moved some procedures to outpatient settings, outpatient surgeries remained relatively flat as well, decreasing 0.2% year over year.
The health system said its same-facility operating revenue, which adjusts for recent divestitures, increased by $1.1 billion over the prior-year period, to $11.9 billion.
Ascension said divestitures contributed to a decline in year-over-year net patient service revenue across all of the health system’s reportable service lines — inpatient care, ambulatory care, physician practices and long-term care. Total NPSR decreased by $1.4 billion compared to the prior year period. Same facility NPSR, which adjusts for portfolio changes, increased $867 million or 9% year over year.
Ascension’s operating expenses decreased by about $1.5 billion compared to the prior year period due to its divestitures and portfolio realignment. Accounting for the divestitures, expenses rose by over 5% compared to the prior-year period. Ascension said rising patient acuity and volume contributed to the increase.
Similarly, although total salaries, wages and benefit costs decreased due to divestitures, costs increased on a same-facility basis by about 3% year over year. Again, Ascension attributed the increase to higher volumes and rising patient acuity, but also said it invested more in hourly wages to stay competitive in the labor market.
The health system reported an operating loss of $139 million, compared to a $365 million loss in the prior-year period.
