Johns Hopkins Health's operating income tumbles after closing heart institute

Johns Hopkins Health System in Baltimore saw its revenue and net income increase in the three months ended March 31, but its operating income fell due in large part to the closing of its troubled Heart Institute at Johns Hopkins All Children's Hospital.

The six-hospital nonprofit academic health system saw its total operating revenue in the most recent quarter increase to $1.7 billion, up 3.6 percent from $1.6 billion in the same period a year prior, according to unaudited financial documents. Total operating expenses also grew, up 5.7 percent from $1.6 billion in the three-month period of 2018 to $1.7 billion in the most recent quarter.

At the same time, Johns Hopkins saw its operating income fall 70.3 percent in the most recent quarter to $13.4 million, down from $45.1 million reported in the same period a year prior. The system said the decrease was mainly due to lower net patient service revenue as a result of the closure of its Heart Institute at Johns Hopkins All Children's Hospital in St. Petersburg, Fla. An internal review of the institute found 13 cases in which heart unit patients were harmed by care. The system said "despite the progress JHACH has made in implementing the plans of correction [at the institute], some areas remain out of compliance and it will take more time to make these changes."

After including a favorable gain on investments during the three months ended March 31, Johns Hopkins ended the period with net income of $168.5 million, more than triple the $45.7 million the health system reported in the same quarter of 2018.

However, Johns Hopkins' net income is down 72.5 percent year-to-date. The health system posted net income of $225.4 million in the first nine months of fiscal 2018, compared to $61.9 million in the first nine months of this fiscal year, due in part to unfavorable investment losses and other nonoperating factors.

More articles on healthcare finance:
Hedge fund manager predicts CHS will go bankrupt
Washington health system files for bankruptcy, cites issues with revenue cycle vendor
CEO Wayne Smith bets on CHS turnaround with $3M investment

© Copyright ASC COMMUNICATIONS 2019. Interested in LINKING to or REPRINTING this content? View our policies by clicking here.

 

Top 40 Articles from the Past 6 Months