Allegheny Health Network's net income surges to $19.1M in Q1

Pittsburgh-based Allegheny Health Network ended the first three months of 2019 with solid finances and net income of $19.1 million, according to unaudited financial documents released May 31.

Allegheny, a subsidiary of Pittsburgh-based Highmark Health, reported revenue of $858.3 million in the first quarter of 2019, up 8.6 percent from $790.3 million in the same period a year prior. The growth was largely attributable to higher net patient service revenue, which increased year over year from $749.4 million to $809.9 million. The system said it saw year-over-year increases in observation cases, in combined total discharges and observations, in physician visits, in total surgery center cases and in births in the first quarter of 2019.

But rising operating expenses offset Allegheny's revenue gains. The system's expenses climbed 8.7 percent year over year to $857.1 million. Expenses grew in patient care supplies, as well as in salaries, wages and fringe benefits.

Allegheny ended the first three months of 2019 with operating income of $1.2 million, down from the $1.5 million the system recorded in the first quarter of 2018.

After factoring in nonoperating gains, Allegheny ended the first quarter of 2019 with net income of $19.1 million, up from $983,000 in the same period a year prior.

In discussing the latest financial results, the system noted significant investments it made in its infrastructure and programs, including opening a new location of its nursing school near Allegheny Valley Hospital, as well as opening a new neonatal intensive care unit in West Penn Hospital and a new cancer and imaging center in Monroeville, Pa.

In the first quarter of 2019, the system said it also completed a 50,000-square-foot perioperative center upgrade at Forbes Hospital and opened a new women and infants center at St. Vincent Hospital.

Other significant investments announced by Allegheny in the first quarter of 2019 were the acquisition of Pediatric Alliance, one of the region’s largest multispecialty pediatric groups, and an investment in Civica Rx, a nonprofit generic drug company.

 

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