Boston-based Mass General Brigham posted a $48 million operating loss of (-0.3% margin) for the fiscal year ending Sept. 30, a significant improvement on the $432 million loss (-2.6% margin) reported last year.
The $48 million loss excludes one-time revenues largely related to federal transfers connected to the pandemic. Inclusive of these one-time revenues, the five-hospital system reported a $95 million income from operations.
Total operating revenue was $18.8 billion in FY 2023. Excluding $143 million in revenue related to federal COVID-19 relief, operating revenue increased by $2 billion or 12% over 2022.
Patient care revenue grew to $12.8 billion, an 8% increase year over year, with strong outpatient activity contributing to revenue growth. The system also generated $1.5 billion in premium revenue (63% increase) from the addition of about 160,000 MassHealth members under a new Accountable Care Organization, $2.7 billion in research and academic revenue (8% increase) and $1.7 billion in other revenue (20% increase).
Operating expenses increased 9% year over year to $18.7 billion. The rise in costs reflected increases in medical claims (51%, related to the increase in health plan membership), wages (8%), costs and use of clinical (14%) and pharmaceutical (26%) supplies, and depreciation and interest (1%).
CFO and Treasurer Niyum Gandhi said financial results show "significant progress" in addressing capacity and labor challenges, but also highlight the need to continue reducing costs, growing revenue and positioning the system for long-term financial stability.
"Looking ahead to 2024, we will enhance our efforts to reduce our long-term expense trend by creating a culture and mindset around resource stewardship and utilization," Mr. Gandhi said. "At the same time, we will double down on initiatives that generate sustainable revenue outside of traditional care delivery, like the continued growth and integration of our Mass General Brigham Health Plan, and innovative solutions that improve patient outcomes."
The system reported an overall gain of $1.2 billion in the fiscal year, including a nonoperating gain of $1.1 billion. This compares to an overall loss of $2.3 billion, including a nonoperating loss of $1.8 billion, in the previous fiscal year.
"Despite persistent capacity and labor challenges, we continue to make progress in transforming our system to meet the needs of an evolving healthcare landscape," President and CEO Anne Klibanski, MD, said. "In the year to come, we are committed to expanding access for patients, investing in our workforce, sustaining our world-class research enterprise and lowering costs while providing the best patient care."