Tower Health attributes operating loss to Epic install, acquisition costs

West Reading, Pa.-based Tower Health ended fiscal year 2018 with an operating loss, but strong investment gains boosted the system's net income, according to audited financial documents released Nov. 26.

The health system reported revenues of $1.62 billion in the fiscal year ended June 30, up from $1.05 billion in fiscal 2017. The increase was largely attributable to Tower Health operating more hospitals. The system acquired five hospitals from Franklin, Tenn.-based Community Health Systems in October 2017.

Tower Health said expenses climbed 56.5 percent year over year to $1.63 billion. During fiscal 2018, the health system recorded $18.57 million in one-time transaction-related costs, which were primarily attributable to the acquisition of hospitals from CHS and Epic installation costs at those hospitals. Tower Health also incurred expenses in the most recent fiscal year related to the sale of The Highlands at Wyomissing (Pa.), a retirement community.

Tower Health ended fiscal 2018 with an operating loss of $10.77 million. The system reported operating income of $9.73 million in the year prior. Excluding the $18.57 million in one-time expenses, Tower Health had an operating margin of 0.5 percent in fiscal 2018.

After factoring in nonoperating income, which more than doubled year over year and was fueled by strong investment gains, Tower Health posted net income of $108.68 million in fiscal 2018. That's up from $52.12 million in fiscal 2017.

More articles on healthcare finance:

UPMC's revenue climbs to nearly $14B in first 9 months of 2018
Hospitals join Giving Tuesday movement
Kaiser's net income dips 23% in first 9 months of 2018


© 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