LAKE OSWEGO, Ore. (KTVZ) – Oregon hospital median operating profit was positive in the second quarter for the first time in five quarters, echoing the St. Charles Health System’s 2023 turnaround but “still far from profitable” “below healthy levels,” underscoring the potential vulnerability of hospital services,” the Oregon Hospital Association said this week.
A new report from Apprise Health Insights shows that Oregon hospitals had a median overall operating profit of 1% and a median overall profit of 2.6%, which includes investment income.
“Both figures remain below pre-pandemic levels and reflect the ongoing challenges faced by hospitals as their operating expenses continue to exceed revenues from their core patient care activities,” the hospital association said.
“Too many hospitals are being forced to dip into their savings and find other ways to pay their bills,” said Becky Hultberg, president and CEO of the association. “We have to go back 2 1/2 years to find out The time a hospital brings in enough operating revenue to pay for patient care.”
Nearly half, or 43%, of Oregon hospitals continued to have negative operating margins in the second quarter of this year.
As for St. Charles Hospital, the hospital system reported operating income of $27.6 million for the six months ended June 30, compared with a loss of $43.3 million for the six months ended June 30, 2022.
Chief Financial Officer Matt Swafford noted that St. Charles Hospital was among more than 50% of hospitals in the state that reported positive operating margins in the second quarter.
“The health system’s financial turnaround cannot be attributed to one thing — it is a systemic approach and the result of the hard work of many people,” Swafford said in a statement to NewsChannel 21.
“Hospital systems across the state and nation continue to struggle, and we remain concerned about the stability of the entire health care industry,” he said.
Swafford added, “Having positive operating margins is critical as St. Charles looks to reinvest in our facilities and make infrastructure repairs and improvements at a time when our efforts are focused on the global pandemic. We are already behind when it comes to response measures.”
Statewide, the hospital association said, “hospitals are facing increasing pressure from an inflationary environment. Operating expenses continued to rise in the second quarter, with employee costs (half of total operating expenses) increasing by $31 from the second quarter.” %” 2020. Supply spending also increased significantly, up 52%. ”
At the same time, operating expenses have increased and revenue from core patient activities has not kept pace, they said. In the second quarter, Oregon hospitals spent $166 million more than they took in.
“I remain concerned about these financial pressures, which jeopardize hospitals’ ability to care for patients in the communities they serve,” Heltberg said. “We have already seen several hospitals make painful decisions to reduce services, and I fear there will be more. More hospitals are making decisions like this.”
Hotberg also said Oregon hospitals continue to face severe health care workforce shortages, which is negatively impacting patient care. While hospitals work with labor groups to support a series of bills in the 2023 legislative session to support and rebuild the health care workforce, the hospital association says “more needs to be done to ensure the stability of hospitals so they can care for the communities they serve” . ”
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About the Oregon Hospital Association
Founded in 1934, the Oregon Hospital Association is a mission-driven, not-for-profit industry
An association representing 62 hospitals in Oregon.The hospital is the sixth largest private hospital in total
A statewide employer employing more than 70,000 people.
Committed to building a stronger, safer Oregon with equitable access to quality health care,
Hospital association serves Oregon hospitals and ensures delivery is available in all hospitals
Provide reliable, comprehensive health care to their communities; educate government officials
and public understanding of the state’s health status; and working with policymakers,
Community organizations and the healthcare community build consensus and drive
Smart medical policies benefit 4 million residents of the state.