Catholic healthcare giant Ascension lost money in the first three months of 2021 even after recognizing more than $100 million in federal grants during the period.
The St. Louis-based system—which has 146 hospitals and operates in 19 states plus Washington, D.C.—lost $16.7 million on operations in the quarter ended March 31, 2021, even after recognizing about $110 million in Provider Relief Fund grants during the period. The loss wasn’t as steep as Ascension’s $429.4 million operating loss in the three months ended March 31, 2020, a quarter that includes the first few weeks of the COVID-19 pandemic but no relief funding.
Expanding those results to the nine months ended March 31, 2021, Ascension posted $779.2 million in operating income, but that includes $889.3 million in federal grants. Without the grants, the system would have lost $110 million in the nine-month period.
Ascension noted in its financial statement that government relief funds helped offset the impact of mandatory and discretionary procedure shutdowns during the pandemic. However, operations and volumes are still below pre-pandemic levels. Ascension estimates the pandemic had a total negative impact of $1.9 billion in lost revenue and added expenses as of March 31, 2021.
Ascension’s revenue grew 1.2% year-over-year to $20.5 billion in the nine months ended March 31, 2021. Expenses grew 2.1% during the same period to $19.8 billion.
Strong investment returns bumped Ascension’s excess revenue over expenses to $4.8 billion in the nine months ended March 31, 2021, a major swing from a $1.9 billion deficit in the prior-year period.
Admissions were down 8.5% in the nine months ended March 31, 2021 year over year, and emergency department visits were down 21% in that time. Surgery visits, both inpatient and outpatient, declined almost 6%.
Some not-for-profit health systems saw their finances perk up at the outset of 2021, while others continue to struggle. Mass General Brigham, RWJBarnabas Health and Ochsner Health, for example, moved into the black after posting losses in the comparable 2020 period. CommonSpirit Health would have lost money if it hadn’t made more than $500 million by selling a portion of its stake in Optum360.