The board of Pennsylvania Hospital in Philadelphia is scheduled to vote this week on affiliating with a larger local hospital. The board is expected to choose between Thomas Jefferson University Hospital or the Hospital of the University of Pennsylvania as partner in a close corporate affiliation short of an actual merger. "By linking up with a larger hospital . . . it will make our rates more attractive, and we'll be in a better position to negotiate with payers," a spokeswoman said. Founded in 1751, Pennsylvania Hospital has 505 acute-care beds and boasts strong specialties in orthopedics and obstetrics.
Medaphis Corp. last week suffered the second free fall in its stock price in two months after posting larger restructuring charges in the third quarter than had been forecast in August. That first report of an expected loss sent shares tumbling more than $21, or 60%, to $14.25. Medaphis had reported that troubles with two business units would lead to $35 million to $40 million in third-quarter charges, leading to losses of 28 cents per share to 33 cents per share (Aug. 19, p. 4). In the report for the quarter ended Sept. 30, charges against income actually totaled $50 million, and the company also restated 1995 results to reflect a loss of $8.5 million, not the previously reported loss of $3.4 million. On Oct. 22, shares of Medaphis fell $6.38, or 38%, to close at $10.38 in NASDAQ trading. Atlanta-based Medaphis provides billing and accounts receivable management services to hospitals and physicians. It also expanded into clinical information technology earlier this year by acquiring Health Data Sciences Corp. (June 3, p. 18).
Naples, Fla.-based Health Management Associates reported a 34% increase in net income to $19.9 million, or 18 cents a share, in its fourth quarter ended Sept. 30. The company posted net income of $14.8 million, or 14 cents a share, in the year-ago quarter. Revenues rose 44% to $193.2 million. For the year, HMA reported a 33% increase in net income to $84.1 million, or 76 cents a share, compared with $63.3 million, or 59 cents a share, in the year-ago quarter. Revenues grew 34% to $714.3 million. HMA owns and operates 25 rural and nonurban hospitals in 11 states.
Brentwood, Tenn.-based Quorum Health Group reported a 20% increase in net income to $17.5 million, or 35 cents a share, for its first quarter ended Sept. 30. That compares with earnings of $14.6 million, or 29 cents a share, in the year-ago quarter. Revenues rose 25% to 316 million. Quorum owns 16 hospitals and manages 250 primarily rural hospitals through its management subsidiary, Quorum Health Resources.