Louisville, Ky.-based Norton Healthcare reported operating income of $44.8 million in the six months ended June 30, a 23 percent decrease from $58.5 million reported in the same period in 2016.
Norton Healthcare attributed the year-over-year $13.7 million decline in operating income to a lower patient service margin in recent unaudited financial documents. The decrease came as Norton Healthcare recorded revenues of $1.1 billion in the first six months of this year, a year-over-year increase of $27.8 million. This reflects a 2 percent increase in patient service revenue and a 17 percent decline in bad debt expenses over the same period in 2016.
At the same time, expenses rose for Norton Healthcare in the six months ended June 30. The health system reported expenses of $972.5 million, a 5.6 percent increase from $920.5 million in the same period of 2016. The health system pointed to an uptick in labor expenses, fees and drug costs, among other expenses, for the increase.
"As a result of greater total direct expense growth than total revenue growth, EBITDA declined from $111.5 million in 2016 to $87.3 million in 2017," the report states.
Year to date, Norton Healthcare achieved $80.6 million in excess revenue over expenses, up from $61.2 million reported in the same period in 2016.