Chicago-based CommonSpirit Health reported a multimillion-dollar operating loss and tightening margins for the first quarter of the 2023 fiscal year, ending Sept. 30.
Six details:
1. The 138-hospital health system reported $23 million income for the three months ending Sept. 30, down from $34 million over the same period last year. However, CommonSpirit received $325 million as part of the California provider fee program under the CMS-approved state plan amendment; after normalizing for the program, CommonSpirit reported a $227 million loss for the quarter.
2. The health system sold its stake in Clive, Iowa-based MercyOne facilities and assets to Livonia, Mich.-based Trinity Health for around $613 million in September. CommonSpirit reported an estimated $34 million loss on the sale.
3. Quarterly EBITDA dropped to $495 million, compared to $503 million last year. The EBITDA margin for the three-month period was 5.5 percent, down from 5.9 percent last year. When accounting for the California provider fee program, quarterly EBITDA was $245 million and margin was 2.9 percent.
4. Acute inpatient days dropped 6.7 percent for the quarter year over year, hitting 977,527. The decrease was primarily due to fewer patients being treated for COVID-19, unfavorable payer and service mix shifts and the MercyOne equity sale. Outpatient visits also dropped 5.3 percent to 6.7 million.
5. CommonSpirit's quarterly operating revenue hit $8.53 billion.
6. Salaries and benefits expenses increased 5.1 percent to $4.5 billion for the quarter due to high registry and contract labor as well as overtime, premium pay and inflation.