Financial Analysis 2008 - News Release

Contact: Stephanie Suran, Deputy Press Secretary
717-232-6787 or

NUMBER OF OUTPATIENT SURGERY CENTERS CONTINUES TO RISE; UTILIZATION AND PROFITS UP

Harrisburg, PA - November 19, 2009 - The number of ambulatory (outpatient) surgery centers (ASCs) licensed in Pennsylvania continues to grow, according to a new report from the Pennsylvania Health Care Cost Containment Council (PHC4). Between June 2008 and May 2009, 17 new ASCs opened and three closed, bringing the statewide total to 261.

The statewide average total margin for the ASCs rose by 1.75 percentage points in FY08, from 24.31% in FY07 to 26.06% in FY08. In the seven years between FY01 and FY08, the statewide total margin for the ASCs has increased 14.64 percentage points – an average of about 2.09 percentage points per year.

In addition to growth in the number of ASCs, the number of outpatient diagnostic and surgical procedures performed in Pennsylvania has grown by 65.1% in the past eight years. More than 62.8% of that growth has occurred at the ASCs, as opposed to outpatient units at general acute care (GAC) hospitals.

"The number of ambulatory surgery centers in Pennsylvania continues to grow," said Joe Martin, PHC4’s Executive Director. "In ten years, the number of ASCs in the state has more than quadrupled, and they remain highly profitable overall."

PHC4’s Financial Analysis 2008, Volume Two reports on the financial health of ASCs and non-GAC facilities (psychiatric, long-term acute care [LTAC], rehabilitation, and specialty hospitals).

The statewide average total margin for the 21 rehabilitation hospitals improved 1.17 percentage points in FY08, from 10.32% in FY07 to 11.49% in FY08. The statewide average operating margin fell 0.13 percentage point from 9.03% in FY07 to 8.90% in FY08.

Although the total number of discharges for patients receiving rehabilitation care at both rehabilitation hospitals and GAC rehabilitation units decreased 0.5% during FY08, the number of discharges at the rehabilitation hospitals increased during FY08 – the first time in six years.

For the fourth consecutive year, the 17 freestanding psychiatric hospitals as a group have posted an increase in the statewide average operating margin. The statewide average operating margin grew another 0.27 percentage point in FY08, from 5.69% in FY07 to 5.96% in FY08. The statewide average total margin increased 0.75 percentage point from 3.80% in FY07 to 4.55% in FY08.

The statewide average operating margin for the 26 LTAC hospitals fell 0.78 percentage point in FY08, from 3.09% in FY07 to 2.31% in FY08. The statewide average total margin decreased 1.13 points from 3.20% in FY07 to 2.07% in FY08.

The Pennsylvania Health Care Cost Containment Council is an independent state agency charged with collecting, analyzing and reporting information that can be used to improve the quality and restrain the cost of health care in Pennsylvania. Copies of Financial Analysis 2008, Volume Two are free and available on the Council’s website at http://www.phc4.org or by calling PHC4 at 717-232-6787.