Community Health Systems wrapped up the year with $311 million in profit in the fourth quarter of 2020 despite seeing ongoing declines in year-over-year admissions experienced by health systems across the industry.
That profit was a big swing from the loss the health system posted of $373 million in the same quarter a year earlier, the company reported Wednesday. Those increased earnings also came despite reduced revenues of $3.1 billion, a 5.1% drop from $3.3 billion in the same quarter of 2019.
Overall for the year, the health system posted earnings of $511 million, up from a loss of $675 million in 2019. That was on revenue of $11.8 billion, a 10.8% drop from revenue of $13.2 billion for the year in 2019.
The earnings increase comes thanks in part to relief funding of about $115 million recognized during the fourth quarter, which helped the system weather the COVID-19 financial crisis. The system recognized approximately $600 million in relief funds for 2020.
In recent years, the health system was also in the midst of what it referred to as a "portfolio rationalization strategy" and sold off large numbers of hospitals around the country to improve its financial picture.
Volumes for the current year have not returned to pre-pandemic levels, officials said in a statement. The health system joined its peers in posting a 12.9% drop in admissions and a 17.8% decrease in adjusted admissions compared with the same period in 2019. On a same-store basis, admissions decreased 3.4% compared to the fourth quarter of 2019.
But the health system did report volumes improved from lows in March and April 2020. On a same-store basis, net operating revenues increased 4.5% for the three months ended Dec. 31, 2020, compared with the same period in 2019, primarily reflecting COVID-19 pandemic-induced changes in the mix of services provided and payer mix compared to the prior period.
“Throughout the COVID-19 pandemic, I have been incredibly proud of everyone across our entire organization. Our caregivers and medical staffs have ensured that their communities have access to essential, high-quality health services. Our management teams have adapted to constantly changing dynamics and effectively executed our cost management efforts," said Tim Hingtgen, CEO of Community Health Systems, in a statement. "As a result, we ended the year with strong financial results, momentum around our key strategic initiatives, and optimism about the future of our company. We look forward to what lies ahead, as we believe we are well-positioned for growth and long-term success that will deliver value for all of our stakeholders.”
The health system will hold its quarterly earnings call with investors at 11 a.m. ET.