CommonSpirit, a 137-hospital system based in Chicago, saw revenues rise in the fiscal year ended June 30 but closed out the period with an operating loss.
CommonSpirit, formed last year through the merger of San Francisco-based Dignity Health and Englewood, Colo.-based Catholic Health Initiatives, said it was on a positive financial trajectory until the COVID-19 pandemic hit.
"CommonSpirit saw strong momentum in financial and operating performance through February, with performance well above last year's level and trending toward positive operating income, before the focus shifted to a systemwide response to the COVID-19 pandemic," the health system said in a release accompanying its earnings statement.
CommonSpirit said adjusted admissions were down 6.2 percent year over year in the most recent fiscal year. After drastic declines in patient volume of up to 40 percent in April, the system saw performance improve significantly in June, July and August. Patient volume is now down 8 percent compared to pre-pandemic levels, the health system said.
For fiscal year 2020, CommonSpirit reported revenues of $29.6 billion, up from pro forma revenues of $28.9 billion a year earlier. Revenues for the most recent fiscal year include $826 million received under the Coronavirus Aid, Relief and Economic Security Act to help offset lost revenue and higher expenses tied to the pandemic.
The health system said operating expenses climbed to $30.1 billion in fiscal 2020, up from pro forma expenses of $29.5 billion a year earlier. Salaries and benefits were up 2.8 percent year over year.
CommonSpirit ended fiscal 2020 with an operating loss of $550 million, compared to a pro forma operating loss of $617 million a year earlier.
"As a nonprofit, faith-based provider of essential care, our first priority is responding to the health needs of our communities," Common Spirit Senior Executive Vice President and CFO Daniel Morissette said in a release. "At the same time we have taken a responsible and disciplined approach to managing our operations and finances during this crisis. While we know it will take some time for our performance to fully recover, we are well positioned to build on the significant progress we saw before the pandemic hit."
After factoring in nonoperating items, CommonSpirit ended fiscal 2020 with a deficit of revenues over expenses of $551 million, compared to a pro forma net loss of $290 million a year earlier.