Pennsylvania hospitals' bottom lines were battered by the financial market as total nonoperating income fell 82% in 2002 -- to $46.5 million -- after two years of modest gains. Of the state's 185 hospitals, 41% lost money in the fiscal year ended June 30, 2002, compared with 33% in 2001, according to the Pennsylvania Health Care Cost Containment Council, a state agency. The average operating margin statewide remained constant, however, at 2.1%, but the average total margin declined to 2.3% in 2002 from 3.3% in 2001. Commenting on the report, which presages a longer report and analysis due out in the spring, the Hospital and Health System Association of Pennsylvania rang an alarm. Growing expenses have forced hospitals to rely more on investments, but the report shows that the financial market's poor performance "has severely damaged this critical financial safety valve for hospitals," association officials said. -- by Cinda Becker
Reduced investment earnings hurt Pa. hospitals
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