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12-Month Profit Picture Mixed at Area Hospitals

Strong pre-tax profit growth from UC Irvine Medical Center and Children’s Hospital of Orange County offset tumbles at other large hospitals during the past year.

The 30 largest hospitals in the county saw their pre-tax net income rise about 13% to $409.2 million for the 12-month period ended Sept. 30, according to this week’s Business Journal list.

Last year, the hospitals on the list saw their pre-tax profit grow 10%.

Revenue and pre-tax income figures come from California’s Office of State-wide Health Planning and Development.

The list is ranked by net patient revenue, which was up 8% to $6.1 billion for 12 months through September.

Twenty-five of the 30 hospitals were profitable through September. Of those, 11 reported higher pre-tax profits during the period compared to a year earlier, while nine reported lower pre-tax profits.

Four hospitals swung to a profit versus a loss the year prior. Two reported a loss versus a year-ago profit.

Two saw a second year of losses.

Two hospitals’ figures are estimates.

No. 6 Kaiser Permanente Anaheim Medical Center does not report financial data to the state. The Business Journal estimates Kaiser’s revenue at $450 million for its Anaheim and Irvine campuses, which operate under the same license.

No hospital posted double-digit revenue declines.

Hospital employment declined 1.6% to 40,928 workers in the last 12 months.

Hoag Memorial Hospital Presbyterian maintained its No. 1 list position of the past few years. Hoag, with campuses in Newport Beach and Irvine, saw its revenue grow 4% to $747 million.

But Hoag took a big tumble in pre-tax profit—with an 82% fall to $11.5 million.

“Initial volume growth and patient demand were not as strong as projected, as a result of a protracted economic downturn,” Hoag spokesperson Nina Rob-inson said.

Hoag is “focused on growth and innovation to meet the needs of our community, including the addition of Hoag Hospital Irvine and Hoag Orthopedic Institute,” Robinson said.

For the third year in a row, UCI Medical Center, an Orange teaching hospital, came in at No. 2 on the list.

UCI’s net patient revenue was up 15% to $705.3 million.

UCI had a big ramp-up in profits during the period—more than tripling to $121.8 million. The hospital’s pre-tax income dropped 40% to $38.5 million a year ago.

Spots 3 through 5 went to hospitals belonging to St. Joseph Health System, an Orange-based Catholic hospital operator. All three hospitals saw their net patient revenue grow but also had big pre-tax net income drops.

St. Joseph Hospital Orange, the No. 3 operator, said its pre-tax profit fell 78% to $8.8 million. St. Joseph’s net revenue was up 6% to $557 million.

Revenue Rises

No. 4 St. Jude Medical Center in Fullerton also saw its pre-tax profit fall to $37.7 million, 42% lower than a year ago. Net patient revenue at St. Jude was up 5% to $468 million.

No. 5 Mission Hospital’s pre-tax profits fell 52% to $27.5 million from $56.9 million a year ago. Net patient revenue at Mission was up 3% to $452.5 million. Mission’s totals include Mission Hospital Laguna Beach, which became part of the St. Joseph system nearly three years ago.

Children’s Hospital of Orange County, which is in the middle of a big expansion (see story, page 14) and Saddleback Memorial Medical Center in Laguna Hills flip-flopped in the Nos. 7 and 8 positions on this year’s list.

Ranked No. 7, CHOC saw its pre-tax profit multiply almost tenfold to $81.8 million. Net patient revenue at CHOC grew 4% to $346 million.

No. 8 Saddleback Memorial Medical Center, which has campuses in Laguna Hills and San Clemente, saw its pre-tax net income fall 33% to $22 million. Saddleback’s revenue also fell 2% to $335.1 million.

Saddleback and No. 10 Orange Coast Memorial Medical Center are owned by Fountain Valley nonprofit MemorialCare Health System.

Fountain Valley Regional Hospital and Medical Center repeated as No. 9 on the list. The Tenet Healthcare Corp. unit’s pre-tax profit more than doubled to $27.7 million. Fountain Valley Regional’s revenue grew 15% to $317.2 million.

Orange Coast posted an 81% profit increase to $18.4 million. The hospital’s revenue was up 5% to $235.4 million.

The largest revenue hike came from No. 20 College Hospital Costa Mesa. College, which offers psychiatric and medical-surgical services, saw its revenue grow 87% to $61.6 million.

Anaheim General Hospital, the No. 29 entry, posted the largest net loss on the list. The hospital, which is owned by Pacific Health Corp., lost $52.8 million in the 12 months ended Sept. 30.

Pacific Health said in April that Anaheim General had been losing money every month, and it was affecting its other hospitals.

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