In fiscal year 2013, Franklin, Tenn.-based hospital operator Capella Healthcare lost $31.8 million, which was more than double its $14.1 million loss in 2012.
In the fourth quarter alone, Capella lost $14.6 million. During that three-month period, Capella underwent what it called a corporate "reorganization," which included eliminating and consolidating several executive positions. Consequently, the company said it absorbed $2.9 million in salaries, wages and benefits related to those changes.
In addition, Capella experienced heavy decreases in volumes. Admissions in the fourth quarter were down 8.3 percent, while adjusted admissions dropped 3.8 percent. Inpatient surgeries and emergency room visits fell 8.6 percent and 7 percent, respectively, in the fourth quarter, and they dropped 2.4 percent and 0.6 percent on the year. However, Capella gained some business on its outpatient side, as outpatient surgeries rose 3 percent and 3.6 percent in the fourth quarter and year, respectively.
Capella's fourth-quarter revenue only increased 0.7 percent to $177.3 million. The for-profit hospital chain's operating loss in the quarter totaled $10.3 million. For the entire 2013 year, Capella's revenue increased only 0.6 percent to $722.3 million. Excluding discontinued operations, Capella posted an operating loss of $19.9 million.
Michael Wiechart, who was named Capella's president and CEO this past January, said in a release the company's struggling finances come in the middle of a "massive transformation of the healthcare system" and a "new era of value-based care." He also said the changes to the company will prove to be positive for long-term success.
"Our corporate reorganization puts us in an even better position to leverage the growth opportunities ahead as well as to more effectively support our hospitals' quality, safety and patient satisfaction initiatives," Mr. Wiechart said.
The 2013 results did not include Capella's recent sale of Grandview Medical Center in Jasper, Tenn., to competitor Hospital Corporation of America in Nashville, Tenn. Capella currently owns and operates 11 acute-care hospitals and a behavioral health center.
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