Contact: Joe Martin
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NON-GENERAL ACUTE CARE HOSPITALS EXPERIENCE MODERATE DECREASES IN 2016 FINANCIAL MARGINS DESPITE 16.8% DECREASE IN UNCOMPENSATED CARE

Harrisburg, PA - October 31, 2017 - Statewide operating and total margins experienced by non-general acute care hospitals (non-GAC) during fiscal year 2016 (FY16) decreased, according to a report released today by the Pennsylvania Health Care Cost Containment Council (PHC4). The foregone dollar value for Pennsylvania non-GAC hospital’s uncompensated care has decreased by 16.8%, or $3.3 million, from $19.9 million during FY15 to $16.5 million during FY16. Non-GAC hospitals include rehabilitation hospitals, psychiatric hospitals, long-term acute care hospitals, and specialty hospitals.

Statewide total margins experienced by each facility type during FY16 ranged from 4.17% at psychiatric hospitals to 9.86% at rehabilitation hospitals, and operating margins ranged from 5.46% at long-term acute care hospitals to 11.11% at rehabilitation hospitals.

“Uncompensated care levels are down for hospitals in Pennsylvania; as reflected in this report and as we reported for GAC hospitals in the Volume 1 report released in April.” said Joe Martin, PHC4’s executive director. “While the non-GAC hospitals in this report showed decreased financial results in FY16 compared to the previous year, there has also been a decrease in uncompensated care.”

Report highlights:

• As a group, psychiatric hospitals operating margin decreased from 8.81% in FY15 to 7.93% in FY16; long-term acute care hospitals operating margin decreased from 8.08% to 5.46%; specialty hospitals operating margin decreased from 7.77% in FY15 to 6.15% in FY16; and rehabilitation hospitals operating margin decreased from 12.87% in FY15 to 11.11% in FY16.
• Statewide psychiatric hospitals total margin decreased from 5.87% in FY15 to 4.17% in FY16; long-term acute care hospitals total margin decreased from 7.24% in FY15 to 5.24% in FY16; specialty hospitals total margin decreased from 10.33% in FY15 to 8.25% in FY16; and rehabilitation hospitals total margin decreased from 11.68% in FY15 to 9.86% in FY16.
• Uncompensated care as a percent of net patient revenue in FY16 among the non-GAC hospitals ranged from 0.53% at long-term acute care hospitals to 1.17% at specialty hospitals.
• Non-GAC hospitals treated 6.12% of the patients that received inpatient care during FY16. GAC hospitals covered 93.88% of the patients that received inpatient care.
• Non-GAC hospitals provided services for 5.72% of the statewide outpatient visits during FY16. The remaining 94.28% of statewide hospital outpatient visits were treated at GAC hospitals.
• The average revenue per discharge during FY16 ranged from $6,422 at specialty hospitals to $42,858 at long-term acute care hospitals.

This is the third volume of a three-volume series of Financial Analysis 2016 reports. Volume One, which was released in April 2017, focused on the financial health of Pennsylvania’s general acute care (GAC) hospitals. Volume Two, released in September 2017, concentrated on Pennsylvania’s ambulatory surgery centers (ASCs). Volume Three focuses on Pennsylvania’s non-GAC hospitals, which include rehabilitation hospitals, psychiatric hospitals, long-term acute care hospitals, and specialty hospitals.

PHC4 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 2016, Volumes One, Two, and Three are available from PHC4’s website at www.phc4.org.