Southfield, Mich.-based Beaumont Health saw improved operating revenue and net income in the first half of 2019, according to recently released financial documents.
The health system reported operating revenue of $2.32 billion in the six months ended June 30, up 2.9 percent from $2.26 billion in the same period a year prior. The boost was partially due to a 2.2 percent year-over-year increase in net patient service revenue.
Beaumont's expenses also increased year over year to $2.25 billion, with a rise in benefits, salaries and professional services compensation.
Beaumont ended the first half of 2019 with net operating income of $66.2 million, up 106 percent from the same period of 2018.
John Kerndl, the health system's CFO, explained that one-time charges contributed to the large variance.
"Our net operating income was unusually low during the same time last year because of one-time charges. Excluding one-time charges incurred in 2018, net operating income through June 2019 was $38.5 million behind last year. This is why we are implementing plans to improve our operating performance," he said in a news release.
After factoring in nonoperating gains, the system's net income totaled $208.98 million in the first six months of 2019. That's compared to $2.56 million in the same period of 2018.
"Our nonoperating gains were driven by strong investments, but market volatility in the remaining months of the year could affect future results. This is a challenging time for healthcare as we face reduced or flat reimbursement rates and increasing prices for drugs, supplies and services," said Mr. Kerndl. "However, we continue to invest in our people through planned salary and benefit increases and remain focused on positioning ourselves for strong future growth by investing in outpatient and urgent care centers. We have also signed a letter of intent with Akron, Ohio-based Summa Health that will allow Beaumont to serve patients beyond the borders of Michigan."
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