Northwestern Memorial HealthCare reported an operating loss (PDF) for the quarter ended Aug. 31, with ballooning revenue offset by major expense increases. Gains in investment income, however, produced an overall $53 million surplus for the Chicago-based not-for-profit.
Operations for its fiscal fourth quarter showed a $6 million loss, compared to a nearly $6 million gain in the same period the prior year, the system's unaudited financial results showed. Northwestern had to rely on a net gain of $59 million in non-operating income to report an overall surplus for the quarter.
Anchored by its namesake hospital on Chicago's lakeshore, the system has been expanding west into the suburbs.
Its next quarterly report should reflect the Sept. 1 acquisition of the two-hospital Cadence Health system. Prior to Cadence, Northwestern last year acquired the 900-physician Northwestern Medical Faculty Foundation for an upfront payment of $230.5 million plus annual payments totaling $118.5 million though 2016.
In April, it spent $80 million to acquire a 28-story office building near Northwestern Memorial Hospital. It had previously been renting about 40% of the building's space. In June, the system received state approval to build a $378 million replacement for its suburban Lake Forest (Ill.) Hospital, acquired in 2010.
Quarterly revenue hit roughly $585 million with annual revenue for its fiscal year ended Aug. 31 reaching almost $2.4 billion. These were increases of 41% and almost 47% from 2013 figures of $417 million and $1.6 billion respectively.
Expenses, however, grew as well. Quarterly expenses equaled $611 million and almost $2.3 billion for the year. These reflected increases of 42% and 45% over 2013 totals of $431 million and $1.6 billion respectively.
For the quarter, Northwestern paid $243 million in salaries and $939 million for the year, increases of 69% and 62% compared to the $144 million and $579 million paid in 2013. Cost for supplies also skyrocketed, up 43% to $105 million for the quarter compared to almost $74 million in 2013.
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