Portland-based Oregon Health & Science University’s swing from an operating loss of $118 million (-2.1% margin) in fiscal year 2025 to an operating income of $135 million (2.2% margin) in fiscal year 2026 came from a growth strategy that system Executive Vice President and CFO Maulin Patel said began two years earlier.
“I wouldn’t call it quite a full turnaround yet because we haven’t achieved those pre-pandemic levels of 4% to 5% operating margins,” Mr. Patel said on a “Becker’s CFO+Revenue Cycle Podcast” episode. “We’re about halfway there, so it was really about intentional growth.”
Mr. Patel, who began his new role in late August after serving as OHSU’s senior vice president of finance and treasurer, said the financial gains came from leaning into care that only the system can deliver as the state’s only academic medical center.
Year over year, OHSU’s complex care activity rose about 30%. The system’s net patient revenue was also up 20%, driven by volume, acuity, collections and rates. Clinical revenue grew about 18.5%, and the system’s research enterprise had a record year for grants. Lastly, OHSU kept expense growth to about 9.5%, and the system held FTE growth to about 2%.
OHSU accomplished this financial improvement with little room to grow. When Mr. Patel joined the system in 2011, it was at 90% capacity. In fiscal year 2026, the system was at 98% capacity overall in what he called the most “underbedded state per capita.” Its top line also still grew at about 9% to 10% per year, he said.
“Post-pandemic…really required us to react to significant external forces, be that sustained inflation, new staffing laws we had to react to, as well as other state laws,” he said. “That, coupled with labor market pressures and other cost increases that really outpaced revenue during those years, those headwinds limited our ability to plan strategically.”
In the process of internal growth, Mr. Patel said OHSU has not ruled out acquisitions for inorganic growth. The system has partnerships throughout Oregon, and it has trained close to 40% of MDs that practice in the state.
OHSU will also release a new strategic plan in 2027. The last time the system had one was pre-COVID, and with all of the changes since then, the new plan looks at where OHSU wants to be in the next five years.
“We now have the stability and time to plan proactively and build momentum rather than simply reacting,” Mr. Patel said. “The goal is durable financial performance. … We’re not a one-year trend here.”
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