Providence, Trinity Health and CommonSpirit, three of the largest nonprofit systems, each reported year-over-year revenue growth, but their operating margins and strategies diverged significantly.
Providence narrowed its losses as it controlled labor costs and improved efficiency, while Trinity Health returned to operating profitability, fueled by strategic investments in outpatient care. Meanwhile, CommonSpirit saw its losses deepen despite revenue growth, as rising labor and supply costs outpaced financial gains.
Here’s how the three health systems’ finances compare, according to their most recent financial documents.
Renton, Wash.-based Providence reported a $644 million operating loss (-2.1% margin) in 2024, improving on a $1.2 billion loss (-4.1% margin) in 2023.
The 51-hospital system saw its operating revenues increase 6.8% year over year to $30.7 billion in 2024. Expenses totaled $31.2 billion in 2024, a 4.2% increase year over year. Labor costs grew by 3.1% to $15.7 billion while supply costs increased 8.2% to $4.9 billion.
Providence attributed its improvement in 2024 to strong patient volumes and a decrease in labor costs due to lower length of stay, a decreased dependence on contractor labor, and high labor productivity.
“We are proud that Providence continues to serve more people in need year over year even as macroeconomic and regulatory pressures continue,” CFO Greg Hoffman said. “While we have made significant progress on our renew and recovery strategies post-COVID, we are not taking it for granted and are practicing continued operational focus and discipline to ensure long-term sustainability, which will position the ministry to thrive for years to come.”
After accounting for nonoperating items, such as investments, the health system posted a net loss of $231 million in 2024, improving on a $596 million net loss in 2023.
Livonia, Mich.-based Trinity Health reported an operating income of $147.6 million (1.2% margin) through the first half of fiscal 2025, up from an operating loss of $38.6 million (-0.3% margin) in the same period last year.
The 93-hospital system reported operating revenue of $12.6 billion for the six months ended Dec. 31, an 8.4% year-over-year increase. Operating expenses reached $12.5 billion, a 6.8% increase over the same period last year. Salaries and wages rose 6.1%, with a 3.8% increase in full-time employees and a 2.3% increase in salary rates. Supply costs grew 10.2%.
Trinity Health is investing heavily in outpatient facilities — including ambulatory surgery centers, urgent care facilities, and imaging and infusion centers — rather than prioritizing large-scale acquisitions.
“Over the next 12 months, we are laser-focused on organic, physician- and surgeon-driven growth. While we will always consider opportunities to grow through acquisitions, most of our growth will come from our community division,” Daniel Isacksen Jr., executive vice president and CFO of Trinity Health, told Becker’s. “We’re seeing major investments in comprehensive ambulatory centers, medical group facilities, ambulatory surgery centers, retail imaging and infusion centers.These changes are significantly influencing capital investment strategies and will continue to do so.”
Trinity reported a net income of $654.6 million in the first half of fiscal 2025, down from $669.1 million over the same period last year.
Chicago-based CommonSpirit reported a $196 million operating loss of (-1% margin) for the six months ending Dec. 31, compared to a $46 million operating loss (-0.2% margin) during the same period the previous year.
Revenue for the six-month period increased 4.5% year over year to $19.5 billion while expenses rose 5.3% to $19.7 billion. Labor costs increased 5.2% to $9.9 billion and supply costs grew by 10.8% to $3.1 billion.
CommonSpirit’s EBITDA was $882 million for the six-months ended Dec. 31, 2024, down from $1 billion during the same period in the prior year. The EBITDA margin for the six-months ended Dec. 31 was 4.5%, a decrease from 5.6% as reported, but an increase from 4.1% when normalized for the California provider fee program, during the same period in the prior year.
“Our team members’ efforts to provide care in more efficient and effective ways have significantly contributed to this quarter’s financial improvements,” CFO Dan Morissette said. “While this progress is encouraging, we must continue strengthening our financial foundation, ensuring that we can deliver high-quality care to all members of our communities, particularly those who are most vulnerable.”
CommonSpirit reported a $276 million net income for the six months ending Dec. 31, down from a $431 million net income in the same period the prior year.