Becker's Hospital Review

21 CFO / FINANCE Ascension's Net Income More Than Triples to $1.8B By Ayla Ellison S t. Louis-based Ascension saw operating income decline in fiscal year 2017, but the system ended the period with higher net income than the year prior due to strong invest- ment gains. Ascension reported revenues of $22.6 billion in fiscal year 2017, which ended June 30, up 3.4 per- cent from revenues of $21.9 billion in fiscal year 2016. e revenue boost was attributable, in part, to an increase in patient volume. Ascension said inpatient admissions, outpatient visits, surgeries, observation days and emergency room visits were up year over year in fiscal year 2017. e patient volume growth was primarily attributable to Ascension's acquisition of Glen- dale, Wis.-based Wheaton Franciscan Health- care's Southeast Wisconsin operations in March 2016. Although Ascension reported revenue growth, the system's rising expenses offset those gains. Ascension's total operating expenses were 4.7 percent higher in fiscal year 2017 than in the year prior. is growth was fueled by higher labor, em- ployee benefits and supplies costs. e system's uncompensated care also increased, climbing 9.2 percent year over year to $1.84 billion. Ascension ended fiscal year 2017 with operating income of $552.7 million, down from operating income of $753.2 million in fiscal year 2016. Aer factoring in strong investment returns, As- cension saw net income increase year over year. e system reported a $1.4 billion investment gain in fiscal year 2017, compared to a $358.3 mil- lion investment loss in the year prior. Ascension reported net income of $1.86 billion in fiscal year 2017, more than three times the net income of $477.7 million the system recorded in fiscal year 2016. "Ascension had a strong and impactful fiscal year 2017 for our organization and for our patients, driven by the organization's focus on providing compassionate, personalized care for all persons where, how and when they need it," said Nick Ragone, chief marketing and communications of- ficer of Ascension. "Ascension is an incredibly well run and business savvy organization," says Scott Becker, publisher of Becker's Healthcare. "It has tremendous lead- ership in Tony Tersigni and their entire team." n Tenet Shutters 4 Regional Management Offices to Cut Costs By Ayla Ellison T enet Healthcare has closed four regional management offices as the Dallas-based hospital operator continues efforts to improve its financial picture, according to Crain's Detroit Business. Tenet is getting rid of the regional management layer to improve its hospital operations business, Dan Waldmann, senior vice president of public affairs at Tenet, said in a statement to Becker's Hospital Review. "These changes will create a more nimble and agile organization, and allow us to better support our hospitals in delivering care to patients and providing health services to communities," he said. The elimination of the regional layer has altered the reporting chain for some Tenet hospitals. For example, Detroit Medical Center's CEO now reports directly to Tenet President of Hospital Operations Eric Evans, according to Crain's Detroit Business. It is unclear how many positions were affected by the closure of the regional offices. The move comes as Tenet is exploring a number of strategic options, including the sale of assets, divisions or the entire company, accord- ing to The Wall Street Journal. The 77-hospital chain ended the second quarter of 2017 with a net loss of $56 million, compared to a net loss of $44 million in the same period of the year prior. Tenet will release its earnings for the third quarter in November. n 5 States With the Highest Out-Of- Pocket Healthcare Spending By Ayla Ellison C olorado has the highest annual out-of-pocket healthcare spend- ing per family, according to a recent report by the JPMorgan Chase Institute. The report examines healthcare spending trends between 2013 and 2016 in the 23 states where Chase has retail branches. The analysis is based on a sample of 2.3 million Chase customers aged 18 to 64. The report revealed wide variation in out-of-pocket spending across the 23 states examined. Here are the five states with the highest average an- nual out-of-pocket spending per family in 2016 based on the analysis. 1. Colorado — $916 2. Utah — $906 3. Connecticut — $880 4. Texas — $873 5. Oklahoma — $854 Those five states had significantly higher spending than the two states with the lowest average annual out-of-pocket spending: California ($596) and Michigan ($601). n

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