NewYork-Presbyterian collects $567M in CARES Act cash, says annual operating loss could reach $1.4B

NewYork-Presbyterian took a financial hit from the COVID-19 pandemic in the first quarter of this year, and the system ended the period with a $128.5 million operating loss. 

NewYork-Presbyterian's revenues totaled $2.2 billion for the first three months of this year, up about 1 percent from a year earlier. Those gains were offset by higher expenses, which climbed 8.6 percent year over year, according to recently released unaudited financial documents

The health system has incurred more than $250 million in incremental COVID-19 operating expenses and about $175 million in capital expenses related to the pandemic. Expenses for personal protective equipment and adding additional personnel, including physicians from outside of the system, to meet inpatient demand, as well as expenses for transportation, housing, food and child care to support that personnel, greatly exceeded estimates, the health system said. 

NewYork-Presbyterian ended the first quarter of this year with an operating loss of $128.5 million, compared to operating income of $29.4 million in the same quarter last year. Management estimates that the COVID-19 outbreak could result in the system posting an operating loss between $600 million and $1.4 billion for this year. 

To partially offset losses, the health system has implemented several cost containment strategies and received funds made available under the Coronavirus Aid, Relief and Economic Security Act. In April and May, NewYork-Presbyterian received approximately $567 million in federal grants. The funding is not expected to cover revenue lost due to the pandemic, and NewYork-Presbyterian said it is seeking additional funding under the CARES Act. 

The health system also applied for and received $530 million in Medicare advance payments, which must be repaid. 

NewYork-Presbyterian ended the first quarter of this year with a deficiency of revenues over expenses of $569.4 million, which included investment losses of more than $447 million. A year earlier, the system reported net income of $277.5 million. 

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