Ten things to know:
1. The health system generated $1.1 billion in operating cash flow during 2024, a 6.8% EBIDA margin, compared to $800 million and a 5.5% margin in 2023.
2. Cleveland Clinic’s 2024 operating income and EBIDA represent year-over-year increases of 329% and 36%, respectively.
3. The health system attributed the improved operating performance in 2024 to a 10% increase in operating revenues — supported by strong patient demand for both inpatient and outpatient services — that outpaced an 8.6% increase in operating expenses compared to 2023.
4. Specific to the fourth quarter, operating income was $137 million (3.3% margin) on revenues of $4.2 billion, compared to operating income of $68 million (1.8% margin) in the fourth quarter of 2023.
5. Cleveland Clinic served the largest number of patients in its history in 2024 with more than 15 million patient encounters worldwide. In 2024, inpatient admissions increased 2%, total surgical cases increased 4% and outpatient evaluation and management visits increased 5% compared to 2023.
6. Despite Cleveland Clinic’s improved operating performance, CEO Tom Mihaljevic, MD, said in his annual State of the Clinic address that about 37% of hospitals are still operating in the red and healthcare has not recovered from the COVID-19 pandemic.
“In the past, we could predict Cleveland Clinic’s financial health based on our productivity and expense management, but even that has changed,” Dr. Mihaljevic said. “Many of our peers have not been able to withstand these pressures. We are doing well by comparison because of demand for our services and because we continuously innovate the delivery of care.”
7.Total operating revenue increased $417 million (11.2%) in the fourth quarter and $1.5 billion (10%) in 2024 year over year. Revenue growth includes increases of over $1 billion in net patient service revenue and a $405 million increase in other unrestricted revenues, such as growth in outpatient pharmacy revenues and international activity and appropriations from the establishment of an endowment fund to expand research and education activities.
8. Total operating expenses increased $348 million (9.5%) in the fourth quarter and $1.2 billion
(8.6%) in 2024 year over year. The increase in expenses is primarily due to the growth in patient volumes and inflationary trends that increased labor and pharmaceutical costs. Agency labor costs remain elevated in Ohio but are below levels experienced during 2023. Malpractice insurance costs continue to increase due to social inflation and other industry trends that have led to higher claim settlement payments.
9. After accounting for nonoperating items, such as investment returns, Cleveland Clinic reported a net income of $980 million in 2024 compared to $911 million in 2023.
10. As of Dec. 31, long-term debt for the system was $4.58 billion and net assets were $16.8 billion.
