From the Northwest to the Midwest to the Northeast, health systems are navigating financial recoveries shaped by distinct pressures — different payer mixes, different market structures and different starting points.
Renton, Wash.-based Providence, St. Louis-based Ascension and Pittsburgh-based Allegheny Health Network each began their turnarounds under different circumstances, serving communities with their own needs and operating in largely different markets.
But across all three systems, leaders pointed to the same pair of priorities: rigorous operational discipline and a deliberate focus on where leadership attention and capital go. Getting back to basics — standardizing operations, investing in leadership and being intentional about resource allocation — runs through each story.
Here are more details on what each CEO recently said about their financial turnarounds and what other health system leaders should know if seeking to replicate something similar.
Providence’s Erik Wexler: $400M turnaround in 18 months
Providence swung from a $225 million operating loss in the first half of 2025 to $175 million in operating income through June 30, 2026. President and CEO Erik Wexler attributed that shift to five moves, executed simultaneously.
Providence cut its subsidiaries and support service corporations from 36 to roughly half, reducing annual operating losses by approximately $100 million. As part of that consolidation, the system sold its health IT consulting arm, Tegria Services Group, to Altaris and sold its revenue cycle company, Acclara, to R1 RCM for $675 million in 2024.
“That is not a space that we should be spending our time in,” Mr. Wexler said of the consulting business, and on the revenue cycle sale, added: “We realized that we are not the best-known experts at revenue cycle, and combining forces with R1 allowed us to advance technological improvement in that space.”
Providence also reviewed underutilized services and reduced agency staffing dependency. At Providence Seaside Hospital in Oregon, the system closed obstetric services — which handled roughly 50 deliveries per year — and opened a level 4 trauma program that treated more than 150 patients by mid-2026. The system additionally paused plans for acute rehab services to prioritize a home care and hospice partnership with Compassus, which Mr. Wexler described as a more immediate need for patients transitioning out of the hospital.
The fifth move was exiting insurance. Providence’s health plan lost more than $100 million in 2025 and the year before. The system announced in May it would shut down most of its insurance operations in 2027, then said in August it would leave the business entirely after a Medicare Advantage deal with a national insurer collapsed.
“I think we need to live in a space of marathon and sprint, and keeping a limited number of initiatives in play is really critical to success,” he said. “Now, 10 or 15, or maybe 20 years ago, that was not as much an issue, because I think healthcare systems, even rural hospitals, safety-net hospitals, had more resources than we do today.”
Ascension’s Eduardo Conrado: $2.6B+ turnaround over 3 years
St. Louis-based Ascension narrowed its operating loss by $371 million in fiscal 2026, closing out a three-year recovery from an $1.8 billion operating loss. President and CEO Eduardo Conrado said the rebound was rooted in fundamentals put in place well before the financial results followed.
For the fiscal year ending June 30, 2026, Ascension reported a $120 million operating loss (-0.2% margin), compared with a $491 million loss (-1.6% margin) a year prior. Excluding bond interest and transaction costs related to the system’s June acquisition of AmSurg, core operations generated $109 million in positive operating income. Net income rose to $1.5 billion from $918 million, and on a same-facility basis, operating revenue grew 9.8% to $24.1 billion.
Mr. Conrado said in a June “Becker’s Healthcare Podcast” interview that the financial recovery was years in the making.
“We looked at the operating model. How do we run efficiently? How do we drive out into a proper site of care? And then how do we manage a revenue cycle?” he said. “That, to me, was just the basics in terms of how do we have a consistent way to operate across all the ministries that we’re in.”
CFO Saurabh Tripathi outlined three guiding principles at Becker’s Annual Meeting in 2025: CTC (Control the Controllables), BTB (Break the Bracket, a data-driven approach to lifting underperforming ministries) and EMS (Every Ministry Should Be Sustainable), which holds that each hospital must be financially self-sufficient rather than subsidized by the broader system.
“A strong financial foundation allows us to continue investing in our caregivers and serving the people and communities who depend on us,” Mr. Conrado wrote in a Sept. 16 LinkedIn post. “That is why financial performance matters. It allows us to invest in access, support our caregivers, and serve people for years to come.”
Allegheny Health Network’s Mark Sevco: On pace for $300M turnaround over 2 years
Eighteen months into his tenure, Allegheny Health Network President and CEO Mark Sevco has guided the system from a $140 million operating loss in 2024 to a projected $160 million positive operating margin in 2026. AHN posted $100 million in positive operating margin in 2025, a $240 million improvement from the prior year. Mr. Sevco noted the second quarter of 2026 included approximately $130 million in Federal Emergency Management Agency reimbursement for prior-year expenses.
Three priorities drove the recovery. AHN first invested in its leadership team through promotions and outside recruitment, with engagement scores rising across every category over the past year. Mr. Sevco described a flywheel in which stronger leadership drives staff engagement, which carries through to patient experience, quality and financial results.
The second priority was building patient volume through expanded access.
“We have grown top-line revenue quite a bit organically by focusing on growth, new patient volume, and actually a culture of ‘yes’ for patient care that has led to about a 15% increase in transfers,” he said. “Our volumes are up somewhere in a range of 3% to 4% across every indicator from prior year, and so from that perspective, that organic growth has really helped us grow into some of the fixed assets that we have.”
Third, AHN benchmarked performance across every operational indicator and pursued best-in-class practices in staffing, clinical productivity and supply chain, generating approximately $40 million in combined improvements. The work aligns with AHN’s broader positioning within Highmark Health, where the organizations make growth decisions jointly and primary care physicians operate under value-based compensation arrangements.
“Operational excellence is looking at reducing variability and hardwiring best practices,” Mr. Sevco said. “When you reduce variability and you move to hardwiring, what I’ve seen through my experience in working is that that tool in the toolbox allows the organization to perform at a higher level and produce stronger, consistent results.”
