- The novel coronavirus delivered a big hit to Advocate-Aurora Health during the first quarter of this year. The major Midwest health system reported an operating loss of $49.3 million for the quarter as it curbed elective procedures to comply with stay-at-home orders and to brace for a surge of patients.
- The pandemic drove the operating margin down to -1.6%, a steep decline from a 4.3% margin during the first quarter of 2019. In March alone, the system generated revenue of $106.3 million, 10% lower than the previous March, as fewer people sought care at physician offices, clinics and emergency rooms.
- Overall, the nonprofit system posted a net loss of $1.3 billion for the quarter as investment income tanked alongside its unfavorable operating results.
Advocate Aurora is just the latest nonprofit health system to report a bruising first quarter due to the fallout from the novel coronavirus.
Other major health systems have reported similarly unfavorable results as they scaled back lucrative elective procedures to prepare for the pandemic.
|Historical utilization||Q1 2020||Q1 2019||Change||% Change|
|Hospital outpatient visits||1,027,074||992,532||34,542||3.5%|
|Home care visits||184,756||194,274||(9,518)||(4.9)%|
Advocate Aurora straddles Illinois and Wisconsin and has a major presence in the Chicagoland region, a hot spot for the coronavirus. There are more than 100,400 cases in Illinois, a majority of which are concentrated in and around Chicago, according to figures from the state.
Advocate Aurora said it has treated and discharged more than 3,000 COVID-19 patients from both states as of Tuesday.
Still, the health system says it has 229 days of cash on hand as it continues to navigate through this public health crisis.
Despite the volatility of the market, the ratings agency Fitch expects a stable outlook for the system, noting it "can withstand expected considerable pressures from the coronavirus pandemic," according to an April 20 report.
The rating agency attributes this to Advocate Aurora's sheer size, as the largest health system for both Wisconsin and Illinois, and its diversified portfolio.
The system reports that it has so far received $328 million in grants from federal funds designated to aid providers during this time. In addition, Advocate Aurora has received $730 million in advanced Medicare payments, which are considered a loan and will have to be paid back.