Becker's Hospital Review

16 CFO / FINANCE Trinity Health gets $86M revenue boost from new hospital By Ayla Ellison L ivonia, Mich.-based Trinity Health recorded higher rev- enue and operating income in the first quarter of fiscal year 2019 than in the year prior, according to unaudit- ed financial documents. Here are four things to know about the health system's financial results: 1. Trinity Health reported revenue of $4.7 billion in the first quarter of fiscal 2019, up 7.1 percent from $4.4 billion in the year prior. The increase is partially attributable to Trinity's ac- quisition of MacNeal Hospital in Berwyn, Ill., from Dallas-based Tenet Healthcare. Trinity said the Illinois hospital generated $86 million in the three months ended Sept. 30. The remain- ing increase was attributable to growth in patient volumes and payment rates. 2. Expenses climbed 6.7 percent year over year to $4.6 billion in the first quarter of fiscal 2019. The MacNeal Hospital acqui- sition accounted for $90 million of the increase. 3. Trinity ended the first quarter of fiscal 2019 with operating income of $100.4 million. That's up 25.5 percent from the same period of fiscal 2018, when Trinity reported operating income of $80 million. 4. After incorporating nonoperating gains, Trinity reported net income of $419.9 million in the first quarter of fiscal 2019, up from $398.9 million in the same period a year earlier. n UPMC Pinnacle to close hospital By Ayla Ellison H arrisburg, Pa.-based UPMC Pinnacle plans to close its hospital in Lancaster, Pa., in 2019 and transition inpatient services to another facility. The health system decided to close UPMC Pinnacle Lancaster and transition inpatient services to UPMC Pinnacle Lititz (Pa.) "after careful assessment of health- care services in and around Lancaster County," UPMC Pinnacle said in a press release. The two hospitals are about 7 miles apart. "Moving inpatient services from UPMC Pinnacle Lancaster to UPMC Pinnacle Lititz will combine the strengths of the outstanding patient care teams from both hospitals, unifying employees and expanding UPMC's high quality of inpatient care and efficient operations in the most modern facility," said David Si- mons, DO, president of UPMC Pinnacle Lititz medical staff. "UPMC Pinnacle Lititz is an updated facility well- equipped to handle additional services while offering the opportunity for future expansion and growth." The transition of inpatient services from the Lancast- er to the Lititz hospital will be completed by March. UPMC Pinnacle said many employees affected by the closure of the Lancaster hospital will be moved into other jobs within the system, according to PennLive. n UnitedHealth purchase price of DaVita Medical Group falls $560M By Alyssa Rege D aVita Medical Group has agreed to sell to UnitedHealth Group and its subsidiary for roughly $560 million less than the previous $4.9 billion acquisition price, the Star Tribune reported. UnitedHealth's healthcare services arm, Op- tum, announced a deal in 2017 to purchase DaVita Medical Group for $4.9 billion. How- ever, DaVita's recent regulatory filings with the U.S. Securities and Exchange Commis- sion indicate the organizations lowered the purchase price to about $4.34 billion. DaVita said in the filing, "As a result of un- derlying business performance and in an ef- fort to expedite the process to obtain [Federal Trade Commission] approval of the proposed transaction, the parties agreed to amend the purchase agreement." e company noted it expects to close the deal during the first quarter of 2019. "We continue to work closely with regulators and Optum to finalize this transaction in a timely manner," a DaVita spokesperson told the Star Tribune in a Dec. 17 statement. At the end of 2017, DaVita Medical Group managed 280 medical clinics across six states and employed an estimated 750 primary care physicians, the Star Tribune reported. Unit- edHealth Group's Optum division has recent- ly stepped up the pace of its physician group acquisitions and currently owns roughly a dozen large clinics operating across 10 states. "Our combination with DaVita Medical Group is an important step in building the nation's first comprehensive, multipayer pri- mary and ambulatory care system, focused on delivering high-quality healthcare and a unique consumer experience. We remain confident in the benefits of this partnership," a UnitedHealth Group spokesperson told the publication in a statement. n

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