- 24-hospital Banner Health, based in Phoenix, AZ, recently completed its acquisition of the University of Arizona Health Network, and subsequently reported a higher 2014 operating surplus due to a 5.9% revenue growth and an improved payer mix.
- Increased expenses saw the system's operating margin drop negligibly to 4.9% from 5% in 2013.
- The hospital did not report patient volumes, but did report significant shifts in its payer mix: Reimbursement from Medicaid beneficiaries grew from 9.1% of its patient service revenue to 11.5%, and self-pay patients accounted for 5%, down from 8.6% last year. Reimbursement from commercial insurers remained steady.
Banner paid $677.8 million for the academic medical center, including assuming UAHN's debt. It will also spent $500 million on capital improvements, including expansions to the hospital. As a result of the acquisition, Banner's unrestricted net assets dropped to $241.2 million, from $843.1 million reported for 2013.
The deal will make the University of Arizona and its medical school Banner's exclusive academic partner.