Tower Health reported higher revenue in the nine months ended March 31, but the West Reading, Pa.-based health system ended the period with an operating loss, according to recently released unaudited financial documents.
The health system reported revenue of $1.6 billion in the first three quarters of fiscal year 2020, up 13.8 percent from $1.4 billion a year earlier. Higher expenses and reductions in patient volume in the most recent quarter due to the COVID-19 pandemic hindered further revenue growth.
Tower Health said expenses climbed 19.2 percent year over year to $1.7 billion in the nine months ended March 31. In the first three quarters of fiscal 2020, the health system recorded $27.1 million in one-time expenses — $7 million related to Epic implementation costs at newly acquired hospitals, and the remainder was related to other one-time transaction costs.
The health system said it had 102 days cash on hand as of March 31, down 52 days from a year earlier. The decrease was primarily due to Epic implementation costs and integration expenses, Tower said.
The health system said it has made significant revenue cycle improvements and expects progress to continue.
"During the COVID-19 crisis revenue cycle management is aggressively pursuing advanced payments and outstanding claim resolution from all major commercial payors as well as ensuring capture of additional reimbursement for services such as telemedicine," Tower said.
The health system ended the first three quarters of fiscal 2020 with an operating loss of $131.9 million, compared to an operating loss of $48.5 million in the same period a year earlier.
After factoring in nonoperating losses, Tower Health recorded a net loss of $153.9 million in the first three quarters of fiscal 2020. In the same period a year earlier, it reported a net loss of $29.3 million.
To offset financial damage from COVID-19, Tower Health has furloughed about 1,000 employees and received $166 million in advance Medicare payments, which must be repaid. The health system also received $66 million in grants under the Coronavirus Aid, Relief and Economic Security Act.