Nonprofit health system CommonSpirit health reported a $145 million operating loss in the quarter ending on March 31. The system faced decreased patient volumes and investment losses as a result of the pandemic.
One of the largest nonprofit health systems, CommonSpirit Health, posted an operating loss in the months leading up to the pandemic. The Chicago-based hospital chain reported a $145 million operating loss in the quarter ending March 31, with part of the loss attributed to declining patient volumes as a result of the Covid-19 pandemic.
Last year, Catholic Health Initiatives and Dignity Health merged to form the healthcare giant, which has roughly 150,000 employees and 134 hospitals across 21 states.
Starting in mid-March, the health system began to see a significant slowdown in volumes, CommonSpirit wrote in its quarterly financial report. To offset this, the health system said it has expanded virtual visits as an option for patients and has looked at more home care services.
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“As communities heed guidelines to avoid hospitals for non-emergent issues, appointment volume, especially for specialty practices, has been reduced and emergency department volume has declined,” CommonSpirit wrote.
Compared to the same quarter last year, CommonSpirit saw a decrease in acute admissions of 11,501. Outpatients were down 141,835 compared to the previous year. Emergency department visits were up by 33,679 visits.
Initially, CommonSpirit said it has remained fully staffed to prepare for a potential surge in Covid-19 cases. Since then, the company has taken to cost-cutting measures, including furloughs, flex time and temporary reductions in executive salaries.
CommonSpirit brought it $7.18 billion in revenue for the quarter ending March 31, up from $7.26 billion last year. But the health system also saw its expenses balloon from $7.38 billion to $7.96 billion, resulting in a widening operating loss. It also reported a $1.01 billion investment loss, as the markets plummeted with the news of the Covid-19 pandemic in late March.
The health system will receive some funding to offset its losses. CommonSpirit said it had received $713 million in grants through the CARES Act. It also received $2.6 billion in funds through the Medicare Accelerated and Advance Payment Program, though it will have to repay those funds to the Centers for Medicare and Medicaid Services. CommonSpirit also said it would apply for reimbursement for qualifying expenses under FEMA’s Disaster Relief Fund.
Source: Medcity News