Hospital Sisters Health System, a 13-hospital network headquartered in Springfield, Ill., barely kept its head above water in its most recent fiscal year as declining admissions and rising expenses ate away at revenue.
HSHS operates hospitals and physician practices in Illinois and Wisconsin. The system said Monday in its audited financial statement that its operating margin in fiscal 2014, which ended June 30, was 0.8%—down from the already slim 1.1% margin posted in 2013.
Admissions at HSHS have declined 7% over the past three years, which executives attributed in part to Medicare's two-midnight rule. The policy, which went into effect last year, essentially says that hospitals can only bill Medicare for inpatient services if an admitting physician expects a patient will have to stay in the hospital for at least two midnights.