Indianapolis-based Indiana University Health reported a year-over-year increase in revenue in the first quarter of this year but ended the period with a net loss, according to unaudited financial documents released April 23.
IU Health's operating revenue totaled $1.6 billion in the first quarter of this year, up 2.5 percent from the same period last year. The health system said several factors contributed to the boost, including annual rate increase and higher volumes in retail pharmacy. Those increases were partially offset by patient volumes, which were driven lower in March by COVID-19.
The health system anticipates the delay of elective surgeries and the expected growth in volume of COVID-19 patients at its hospitals will have a negative impact on near-term revenues and operations. The ultimate effect on its financial and operating results is presently unknown due to the rapidly evolving nature of COVID-19 response, IU Health said.
The health system's operating expenses climbed 8.1 percent year over year to $1.5 billion in the first quarter of this year. Salaries, wages and benefits climbed 6.1 percent due to pay increases and adding more than 700 full time equivalent employees. IU Health also continued to pay employees who had limited work due to lower patient volumes and deferral of elective procedures but were willing to be part of a resource pool to assist as COVID-19 ramped up, the health system said.
IU Health ended the first quarter of 2020 with operating income of $77.6 million, down 50 percent from $153.9 million in the same period a year earlier. After factoring in nonoperating items, including $662.5 million in investment losses, IU Health ended the first quarter of this year with a net loss of $631.3 million. That's compared to net income of $433.9 million in the first quarter of last year.
IU Health said it has received $67.7 million from the $100 billion emergency fund allocated to hospitals in the Coronavirus Aid, Relief and Economic Security Act. The health system also received $348 million in advance payments from CMS, which must be repaid.