- Ascension, the nation's largest non-profit hospital, announced Monday that Marshfield Clinic Health System (MCHS), the largest private medical practice group in Wisconsin, has agreed to purchase its Marshfield, WI-based Saint Joseph's Hospital. The terms of the agreement were not disclosed.
- MCHS CEO Dr. Susan Turney described the transaction as a "defining moment for the future of healthcare for people in Marshfield."
- The hospital in Marshfield that MCHS had been contemplating building earlier this year would have been competition for St. Joseph's, Modern Healthcare reports.
Several non- and for-profit hospitals had significant financial losses during 2016, earnings reports show. This includes Ascension, Catholic Health Initiatives, Banner Health, Cleveland Clinic and Tenet Healthcare. The reasons for their financial struggles have varied, as well as the strategies many have used to address bad debt and losses. For example, Community Health Systems has also been selling its hospitals and Banner Health announced earlier this month the elimination of some leadership positions and several layoffs. More than a half of U.S. hospitals (52%) lost money on operations in 2016, Cleveland Clinic CEO Toby Cosgrove said last week.
Last week, Moody's reported that earnings for for-profit hospitals are expected to grow in the single digits over the next 12 to 18 months. "Positive same-facility revenue growth and flat margins drive our stable outlook for the US for-profit hospital sector," Moody's Jessica Gladstone said in a statement.
Yet the uncertainty around healthcare reform may lead to hospitals being more cautious with their budgeting and try new strategies to rein in spending. Igor Belokrinitsky, a healthcare strategist at Strategy&, a member of PwC, believes hospital administrators will say, "No cost increases next year," he recently told Healthcare Dive. "Budget for zero cost increases or potentially even a little bit of a hit."