This week’s Business Journal list of largest hospitals reflects a tale of two years.
The county’s 30 largest hospitals saw a 404% surge in pretax net income to $346.9 million for the 12 months ended Sept. 30, according to the list.
On last year’s list, the county’s 32 largest hospitals saw pretax income drop 84% for the 12 months through September 2008 as the economy began to deteriorate.
Revenue and pretax income figures came from California’s Office of Statewide Hospital Planning and Development.
The list is ranked by net patient revenue, which was up 6% to $5.4 billion for the 12 months through September (see correction below).
Twenty-five of the 30 hospitals were profitable through Septem-ber. Of those, 11 reported higher pretax income for the period.
Of the 30 total, nine swung to profits versus losses a year earlier. One reported a loss versus a year-ago profit. Five saw lower pre-tax net income. Three saw a second year of losses.
One hospital, No. 5 Kaiser Permanente Anaheim Medical Center, does not report financial data to the state and declined a request to disclose numbers.
The Business Journal estimated its revenue at a combined $400 million for its Anaheim and Irvine hospitals, which operate under the same license.
Hoag
No. 1 Hoag Memorial Hospital Pres-byterian in Newport Beach swung to a
pretax profit of $22 million from a pretax loss of $77.4 million a year earlier. Hoag’s net patient revenue was up 9% to $677 million.
Officials said the pretax profit came from investment gains. Like other hospitals, Hoag’s investments help offset costs for which it isn’t reimbursed.
UCI Medical Center, an Orange teaching hospital, followed Hoag in the list’s No. 2 position with $603.7 million in net patient revenue, up 13% from a year earlier. Pretax income totaled $64 million, up 7% from $59.6 million a year earlier.
In an earlier interview, new Chief Executive Terry Belmont said the hospital has seen growth in neurosciences and cancer care.
The three local hospitals owned by Orange-based Catholic hospital operator St. Joseph Health System also reflected the list’s trend.
No. 3 St. Joseph Hospital-Orange swung to a $23 million pretax profit from a $7.9 million loss a year earlier. St. Joseph’s revenue was up 6% to $493.7 million.
Sister hospital No. 4 St. Jude Medical Center in Fullerton also saw a rebound, posting a $47.3 million profit from a $3.3 million loss a year earlier.
And No. 6 Mission Hospital in Mission Viejo’s pretax profit jumped 214% to $32.5 million. Mission’s revenue was up 11% to $370.2 million for the period ending Sept. 30.
The figures for Mission Hospital, which is in Mission Viejo, include Mission Hospital Laguna Beach, which formerly was South Coast Medical Center and which St. Joseph took over last year after a $36.5 million buyout.
St. Joseph saw a recovery in its investments that helped results, said Darrin Montalvo, chief financial officer of St. Joseph Health System.
No. 7 Saddleback Memorial Medical Center, which has campuses in Laguna Hills and San Clemente, had an 8% pa-
tient revenue gain to $353.3 million. Saddleback’s net income grew 31% to $31.7 million.
Fountain Valley-based MemorialCare Health System owns Saddleback and Orange Coast Memorial Medical Center in Fountain Valley, the list’s No. 10 entry.
Children’s Hospital of Orange County followed Saddleback as No. 8 on the list. The Orange pediatric hospital’s pretax profit rose 128% to $9.9 million.
Its net patient revenue was flat at $330.7 million.
CHOC improved profitability by growing revenue and cutting costs, said Kerri Ruppert Schiller, its chief financial officer. While hospital stays increased, CHOC was able keep costs in check, she said.
The hospital’s investment gains also were up $1.1 million for the 12 months ended September compared to a year earlier, Ruppert Schiller said.
No. 9 Fountain Valley Regional Hospital and Medical Center saw a 2% revenue hike to $258 million. Pretax profit was down 17% to $7.2 million.
No. 10 Orange Coast Memorial’s net pa-tient revenue grew 6% to $205.9 million, and it saw a 44% profit hike to $16.3 million.
The hospital opened an outpatient tower last year.
Still Recovering
While hospitals are beginning to see brighter days, they still are feeling the effects of the sluggish economy.
With the county still losing jobs, more uninsured patients are seeking emergency room care, which is costly for hospitals.
At the same time, hospitals are seeing fewer people opt for outpatient elective procedures, which are among the most profitable.
Of the five hospitals on the list that re-ported lower revenue, No. 26 Anaheim Gen-eral Hospital saw the steepest fall in terms of percentage drop and total dollar amount.
Its net patient revenue was down 35% compared to a year earlier to $24.4 million.
Last summer, the federal Centers for Medicare and Medicaid Services cut off reimbursement for Anaheim General after several inspections revealed problems such as medication errors, unsafe medical equipment, expired supplies and improperly sterilized surgical equipment.
Anaheim General had appealed the decision but withdrew its appeal in mid-December and said in published reports that it is applying to be recertified by the Centers for Medicare and Medicaid Services. The hospital also closed its labor and delivery ward in early 2009.
