IASIS Healthcare said consolidated revenue increased in the third quarter of fiscal year 2016 due to patient volume and managed care growth, but the Franklin, Tenn.-based hospital network ended the quarter with an operating loss.
Here are seven things to know about the system's most recent financials.
1. IASIS posted consolidated revenue of $814 million in the third quarter of FY 2016, up 18.6 percent from $686.3 million in the same period of the year prior.
2. The financial boost reflects a combined 70.7 percent growth in covered lives across all product lines of the company's managed care operations and an increase in patient volume at its acute care hospitals. IASIS said admissions were up 0.4 percent in the third quarter compared to the same period of 2015. When adjusted for outpatient activity, admissions increased 1.6 percent.
3. Revenue attributable to the hospital network's managed care operations totaled $324.7 million in the third quarter, up 53.6 percent from the same period of 2015.
4. The hospital network's expenses grew faster than revenue, increasing 24.1 percent year over year to $848.8 million in the third quarter of FY 2016.
5. During the third quarter of FY 2016, the hospital network's managed care division incurred $8.8 million in losses with respect to its Arizona health insurance marketplace exchange plan business, most of which was attributable to unfavorable risk adjustment transfer settlements, IASIS said. The company's managed care division has notified Arizona regulators that it will exit the state's exchange business, effective Jan. 1, 2017.
6. IASIS said results of operations for the third quarter of FY 2016 were also negatively impacted by $17.4 million of unfavorable prior period medical claims development in the company's managed care division. The managed care division's increase in medical expenses in the third quarter of FY 2016 reflects rising pharmacy costs, particularly related to high-cost specialty drugs, increased acuity levels for certain higher cost enrollment groups and growth in new members with higher medical costs.
7. IASIS ended the third quarter of FY 2016 with an operating loss of $34.6 million, compared to an operating gain of $2.4 million in the same period of the year prior.
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