Dignity Health operating loss widens to $47.5M as system grapples with rising costs

San Francisco-based Dignity Health saw its revenue grow in the first quarter of its fiscal year 2016, but the 39-hospital system still posted a loss for the period.

The system reported revenue of nearly $3.1 billion in the first quarter of FY 2016, up 16.1 percent from the same period a year ago. The revenue growth was attributable to an increase in patient volume and higher supplemental Medicaid payments in Arizona and California.

The system ended the first quarter with an operating loss of $47.5 million, compared to an operating loss of $15.2 million in the same period a year ago.

Dignity said a number of factors led to its operating loss in the first quarter of FY 2016, including a 9.7 percent year-over-year increase in salaries and benefits and a 9.3 percent year-over-year increase in supply costs.

After accounting for a $258.8 million hit on its investments, Dignity ended the first quarter with a net loss of $320.1 million. That's compared to a net lost of $28.9 million in the same period of last year.

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