Cleveland Clinic ended the second quarter of 2018 with operating income of $25.1 million, down 80 percent from $130.5 million in the same period a year earlier, according to recently released unaudited financial documents.
Cleveland Clinic's revenues increased to $2.21 billion in the second quarter of this year, up 2 percent from $2.16 billion in the second quarter of 2017. However, higher expenses offset the system's revenue gains. Cleveland Clinic said operating expenses climbed 7.3 percent year over year.
During the second quarter of this year, Cleveland Clinic saw notable increases in expenses related to salaries, wages and benefits, as well as pharmaceutical and supplies costs. To address the growth in expenses, Cleveland Clinic said it is developing and implementing cost management and containment plans as part of an ongoing initiative launched in 2013.
Cleveland Clinic commissioned a Care Affordability Task Force in 2013 to analyze the system's cost structure and identify cost and efficiency opportunities. Since its inception in 2014, the task force has helped Cleveland Clinic roll out initiatives that resulted in $1 billion of improvements in the system's cost structure.
After factoring in nonoperating gains, which dropped 73 percent year over year, Cleveland Clinic recorded net income of $80.7 million in the second quarter of 2018, compared to $303.3 million in the same period of the year prior.
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