Universal Health Services, King of Prussia, Pa., said a decline in admissions at most of its hospitals and poor margins at five new hospitals contributed to a drop of nearly 25% in third-quarter earnings. The company reported profits of $37.8 million, or 62 cents per share, down from $49.1 million, or 79 cents per share, in the year-ago quarter. Revenue rose 16.2% to $1.01 billion. For the nine months ended Sept. 30, Universal earned $132.3 million, or $2.14 per share, down 13% from net income of $152.8 million, or $2.45 per share, in the year-ago period. Revenue for the nine months rose 16.3% to $3.07 billion. As of Sept. 30, Universal owned or operated 27 acute-care and 44 behavioral-health hospitals.
California losing another ER
Suburban Medical Center, Paramount, Calif., said it plans to convert its emergency room into an urgent-care center that will no longer accept ambulance calls beginning early next year. The move marks the 10th ER in California-and the ninth in Los Angeles County-to close or announce plans to close this year. The 182-bed facility, owned by Tenet Healthcare Corp., serves the same area as ElaStar Community Hospital, which closed in August, and Martin Luther King Jr./Drew Medical Center, which plans to close its trauma center by year-end. Suburban officials said the ER closure was necessary to stem mounting losses; the 33-year-old hospital lost $9.3 million on $45.6 million in revenue last year, according to California's Office of Statewide Health Planning and Development.
Malpractice insurance levels off
Rates for medical malpractice insurance appear to be leveling off slightly, but triple-digit increases continue and many physicians are paying more than ever for coverage, according to the 2004 national survey from the Chicago-based Medical Liability Monitor. The independent newsletter that has surveyed providers of medical liability since 1991 found that the majority of rate increases were about 7% to 25%, lower than the range of 10% to 49% in 2003. Still, physicians, especially those in high-risk specialties, are paying more than ever for insurance.