Providence Health became the latest hospital system to suffer staggering losses in the first quarter of the year, posting a $510 million operating net loss as well as investment declines of $359 million.
The 51-hospital system reported its financial earnings on Monday for the quarter, generating $6.28 billion in operating revenues but experiencing nearly $6.8 billion in expenses. Like other hospital systems, Providence faced a rapid rise in COVID-19 cases at the beginning of 2022.
“Providence began the first quarter of 2022 with some of its highest COVID-19 admissions to date, with the daily census peaking at 2,420 patients in January of this year,” the system said in a release Monday. “As COVID-19 cases began to recede, Providence saw non-COVID-19 admissions and outpatient visits ramp up.”
Providence’s $6.2 billion in operating revenues is down compared to the $6.4 billion it generated in the first quarter of 2021. Expenses also inched up in the quarter, generating $6.79 billion compared with $6.6 billion in the same period last year.
Those operating expenses were fueled in part need for staffing. Salaries and benefit costs increased 13% for the quarter compared to 2021 “due to increased agency spend, overtime and wages, including actions taken by the system to improve retention.”
Hospitals across the country have faced higher labor expenses and higher rates for contract staff as they shore up capacity to fight the previous surge.
Expenses for medical supplies, on the other hand, were flat compared to the same period in 2021.
Providence is the latest to post a loss for the first quarter of the year as systems faced a major COVID-19 surge in the beginning of the quarter fueled by the highly transmissible omicron variant.
Cases started to recede as the quarter went on, and some systems have reported increases in surgical volumes as patients start to return to hospitals for delayed or foregone care.
But hospitalizations are starting to rise again across the country due to sub-variants of omicron.