In the year 2015, overall hospital profitability was on the decline for 27% of healthcare agencies in Pennsylvania.
More than a quarter of acute care hospitals in Pennsylvania failed to achieve profitability in 2015, in accordance to a recent report by the Pennsylvania HealthCare Cost Containment Council (PHC4). 29 percent of the 170 hospitals in the state lost money on operations.
Forty-three of the hospitals with operating losses in 2015 or 88%, had annual net patient revenues below $150 million. Also, those that experienced negative operating margins did not have enough revenue from patient care and other sources of revenue to cover operating expenses, the report said.
In 2015, statewide inpatient revenue was $21.6 billion, which was a 4% increase from the previous year. Operating expenses, however, increased by $1.4 billion, or 3.7%. This may explain why there was a slight reduction in total various hospitals’ total profit margins.
The statewide operating margin increased 1.21 percentage points from 4.25% to 5.46 percent during 2015.
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