Three of the country's largest nonprofit health systems — Ascension, CommonSpirit and Trinity Health — saw varying degrees of improvement in their fiscal 2024 results despite ongoing payer challenges and rising labor and supply costs.
Ascension reported a $1.8 billion operating loss, partially recovering from the previous year's $3 billion deficit, while CommonSpirit posted a $581 million loss, showing progress from its previous $1.3 billion shortfall. Trinity stood out with a slight operating income of $68.4 million, driven by strong cost controls and a rebound in patient volumes.
Here's how the three health systems' finances compare for the fiscal year ending June 30:
Ascension reported a $1.8 billion operating loss (-4.9% margin) in FY 2024, with operations hampered by a ransomware attack earlier this year. The results are a notable improvement on the $3 billion operating loss (-5.5% margin) reported in FY 2023.
The 136-hospital system's economic improvement plans focus on volume growth, rates and pricing, and cost levers. It is also reorganizing its portfolio with several transactions in multiple markets.
After factoring in nonoperating items, such as investment returns, Ascension reported a $1.1 billion net loss in FY 2024, representing a $1.6 billion turnaround from the prior year. The health's long-term debt stands at $6.76 billion.
"While temporarily impacted by the cybersecurity incident, Ascension's balance sheet and liquidity levels remain strong with sufficient liquidity to continue to provide care for patients," CFO Saurabh Tripathi said. "Ascension's solid financial foundation of a strong balance sheet with approximately $41 billion of assets and over $15 billion of liquidity was built to weather a storm like this. With the strong momentum of operational improvements, I am confident Ascension's best days are ahead of us."
Trinity Health (Livonia, Mich.)
Trinity reported a $68.4 million operating income (0.3% margin) in FY 2024, compared to a $288 million operating loss (-1.3% margin) in FY 2023.
Operating revenue for the 101-hospital system increased 10.5% year over year to $23.86 billion while expenses grew by 8.8% to $23.79 billion. On a same facility basis, salaries and wages rose $558.2 million (6.2%) in fiscal 2024 as Trinity continues to implement initiatives to address staffing shortages and wage inflation. On a same facility basis, contract labor costs decreased $81.4 million (25.5%).
The health system continues to use strong cost controls over contract labor and other operational spending. Labor stabilization initiatives include its FirstChoice internal staffing agency and the TogetherTeam virtual connected care model.
Fiscal 2024 net income was $475.5 million, down from $959.7 million in fiscal 2023.
Chicago-based CommonSpirit posted a $581 million operating loss (-1.5% margin) in FY 2024, compared to a $1.3 billion operating loss of $1.3 billion (-3.6% margin) in FY 2023.
Operating revenues were $37.5 billion for the year ended June 30, up from $34.1 billion in the same period last year. Operating expenses were $38.1 billion in 2024, up from $35.3 billion Salaries and benefit expenses totaled $19.1 billion, up from $18 billion the prior year.
CommonSpirit attributed its improved financial performance to strong volumes with a reduction in labor costs and higher productivity.
"While we are encouraged by the improvement in our finances for fiscal year 2024, we know there is more work to be done to accelerate this trajectory," CFO Dan Morissette said. "We have focused on operational excellence and strategic growth, and we will continue to lean into these areas as we work to expand on these successes."
The health system posted a net income of $681 million in FY 2024, up from a net loss of $187 million in FY 2023.