Providence, Ascension post losses in Q1 as COVID-19 causes drop in patient admissions

A financial chart
Major hospital systems Providence St. Joseph Health and Ascension Health detailed the impact of COVID-19 on their finances in the first quarter of 2020. (Getty/Ca-ssis)

Major nonprofit hospital systems Ascension Health and Providence St. Joseph Health joined the parade of health systems that posted losses in the first quarter due to the massive decline in patient volume and cancellation of surgeries due to the COVID-19 pandemic.

St. Louis-based Ascension, which has 150 hospitals, posted losses of $2.7 billion in the first quarter compared with $1.1 billion in earnings in the first quarter of 2019.  Meanwhile, 51-hospital Providence posted a $276 million operating loss for the first quarter compared to a loss of $4 million for the same period last year.

Both systems expressed major problems with the decline in patient admissions, and both canceled elective procedures in mid-March.

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Stay-at-home orders caused “substantial portion of the population to remain at home and forced the closure of certain businesses, which had an impact to the system’s volumes and revenues for most services,” Ascension said in a financial report released this week.

In all, Ascension reported a $2.4 billion loss in investment returns and contributions from business combinations. It also reported a $429 million loss from operations.

Providence officials said total outpatient visits decreased by 3% for the first quarter compared with the same period in 2019. Acute adjusted admissions decreased from 258,000 in 2019 to 242,000 in the first quarter of 2020.

“As a result, acute patient days and acute average daily census both decreased by 5% and 6%,” Providence added. Providence reported operating revenue of $6.3 billion, a 5% increase compared to the same period in 2019.

Officials also noted that the system faced increased costs for personal protective equipment, pharmaceuticals, labor and staffing to deal with the surge of COVID-19.

One improvement: Providence did see an increase in health plan members from 660,000 in the first quarter of 2019 to nearly 700,000 in 2020.

Both systems received millions in relief funding from the federal government out of a $175 billion fund passed by Congress.

Last month, Ascension got about $2 billion of accelerated payments.

RELATED: Providence St. Joseph offers coronavirus lessons from treating 'patient one' in the U.S.

Ascension got nearly $400 million across 37 facilities, according to an analysis from policy resource center Good Jobs First. Providence received $446 million in funding, the analysis said.

It remains unclear how much more of a hit the systems will take for the second quarter. Hospital systems have made steps to reopen elective surgeries canceled or postponed back in March but are under stringent conditions for testing and infection control. 

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