CommonSpirit expects $1B in cash payments by end of year

CommonSpirit CFO Dan Morissette said the Chicago-based health system expects to receive more than $1 billion in cash payments by end of 2024 or early 2025 on four one-time funding opportunities. 

Four things to know:

1. Mr. Morissette said on the system's second-quarter investor call Feb. 29 that it has received $234 million from 340B settlement payments in January. 

2. FEMA reimbursements related to COVID-19 are all in process, he said. 

"It's a material amount in reimbursements once all of the 70 applications are approved," Mr. Morissette said. "We expect FEMA to obligate the funds by the end of the fiscal year 2024, but again it depends on how soon they finish the review and audit of these applications." 

3. Mr. Morissette said the IRS received the health system's employee retention credit applications in June and are awaiting additional cash payments. 

"We expect to receive a significant amount once all the applications are processed and approved," he said. "So far we've received about $110 million, so we expect more in either fiscal year '24 or fiscal year '25." 

4. The health system is continuing to work with its forensic accountants and insurance company related to its cyber recovery efforts. 

CommonSpirit detected a ransomware attack on its IT network in October 2022. The fallout led to ambulances being diverted and patients being turned away from appointments and an estimated $160 million in costs. The system said in May that it expected that most of those costs will be recoverable. 

"This is a work in progress and we will book this as soon as we reach an agreement with the insurance companies," Mr. Morissette said. 

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