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PHC4 RELEASES NEW HOSPITAL FINANCIAL INFORMATION – UNCOMPENSATED CARE DROPS 8.6%

Harrisburg, PA - May 26, 2016 - The statewide total margin realized by the General Acute Care (GAC) hospitals in Pennsylvania decreased slightly by 0.01 percentage points, from 5.66% to 5.65%, and the statewide operating margin increased 1.21 percentage points from 4.25% to 5.46% during the fiscal year that ended June 30, 2015 (FY15), according to a report released today by the Pennsylvania Health Care Cost Containment Council (PHC4). The statewide operating income for Pennsylvania hospitals increased 34.7% from $1.7 billion in FY14 to $2.3 billion in FY15.

"While the data shows many of the 170 Pennsylvania hospitals experienced positive operating and total margins in fiscal year 2015, and uncompensated care dropped 8.6%, there were 49, or 29%, hospitals that lost money on operations and 46, or 27%, lost money overall," said Joe Martin, executive director of PHC4.

The report also shows that the value of uncompensated care—uncollectible debt and charity care—provided by hospitals in the commonwealth decreased by 8.6% in FY15, or $92 million, to a total of $975 million. Prior to FY15, there was a steady increase in the dollar value of uncompensated care, which rose from $461 million in FY01 to $1.07 billion in FY14.

Report highlights:

• The statewide total number of patient days declined for the eighth consecutive year at Pennsylvania hospitals, from 8.35 million in FY14 to 8.22 million in FY15.
• Statewide inpatient revenue increased 4.0% during FY15 from $20.8 billion in FY14 to $21.6 billion in FY15.
• Operating revenue increased 5.0%, or $2.0 billion, while operating expenses increased 3.7%, or $1.4 billion.
• Total operating revenue increased to $42.5 billion and operating expenses increased to $40.2 billion in FY15.
• Of the $40.2 billion in statewide net patient revenue 53.7%, or $21.6 billion, was derived from inpatient care.
• Hospitals reported a 2.5% increase in the number of outpatient visits in FY15 to 38.6 million visits.
• Outpatient revenue increased 6.0% during FY15, rising to $18.4 billion.

The Volume One financial analysis of GAC hospitals is the first of three PHC4 publishes annually. Volume Two on Ambulatory Surgery Centers and Volume Three on non-GAC hospitals will be released later this year.

PHC4 is an independent state agency charged with collecting, analyzing and reporting information about the cost and quality of health care in Pennsylvania. Copies of Financial Analysis 2015, Volume One are free and available at PHC4's website at http://www.phc4.org.