Pittsburgh-based Allegheny Health Network saw positive operating income in the quarter ended Sept. 30, but the network ended the three-month period with a net loss, according to unaudited financial statements.
Five things to know about the health system's third-quarter financial results:
1. AHN, a subsidiary of Pittsburgh-based Highmark Health, ended the third quarter of 2018 with operating income of $5.4 million. That's down from $10.6 million in the same period a year prior but marked the network's sixth consecutive reporting period with positive operating income.
2. The network reported operating revenue of $821.9 million in the third quarter of 2018, up from $771.3 million in the same period a year prior. In the first nine months of 2018, the network reported operating revenue of $2.4 billion, up from $2.3 billion in the first nine months of 2017.
3. AHN spokesperson Dan Laurent said patient volumes at AHN in the third quarter of 2018 and year to date are consistent with prior-year numbers. The network saw physician visits, observations and ambulatory surgery center cases increase in the first nine months of 2018, compared to the same period of 2017.
4. The health system saw expenses widen to $816.5 million in the third quarter of 2018, up from $760.8 million in the same period a year prior. Mr. Laurent said the growth in expenses reflected investments in capital improvement projects such as a new full-service community hospital in Wexford, Pa., which is scheduled to open in 2021, and a new neighborhood hospital in McCandless Township, Pa., which is scheduled to open late next year. He said AHN also opened a new multispecialty outpatient center in O'Hara Township, Pa., and a new multispecialty medical center in Pittsburgh during the third quarter of 2018. The system also implemented the Epic EHR at its Allegheny Valley and Canonsburg hospitals.
5. After factoring in nonoperating revenue and expenses, AHN ended the third quarter of 2018 with a net loss of $10,000, compared to net income of $13.4 million in the same period of 2017. Mr. Laurent said a one-time, $7.5 million cost associated with a bond issuance that refunded existing debt contributed to the net loss. Year to date, the network reported net income of $18 million. The network noted that while net income is behind last year’s year-to-date figures, for 2018, AHN has improved compared to a year ago operationally, as its operating income and operating margin are ahead of last year’s numbers.
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