Allina Health, a 14-hospital system, reported a higher operating surplus for 2014 as it held expense growth in line with revenue.
The Minneapolis-based system's operating margin also showed a modest bump to 4% for the year ended Dec. 31, up from 3.9% in 2013. Allina finished the year with an operating surplus of $145.9 million on $3.6 billion in revenue (PDF), an increase from 2013's operating surplus of $133.4 million on $3.4 billion in revenue.
Yet volatility in the financial markets lowered its bottom line to $146.9 million, down from $326.5 million the previous year.
Allina did not provide details for patient volume in its earnings report.
The system has been building its footprint with acquisitions. In 2013, it added the Courage Center, a provider of rehabilitation services in the Minneapolis area, and assumed full ownership of Regina Medical Center in Hastings, Minn., in which it had previously had only a 25% stake. The two transactions combined contributed nearly $35 million in revenue.
Allina returned to the dealmaking table this year, in January adding Rice County District One Hospital in Faribault, Minn.
Fitch Ratings and Moody's Investors Service affirmed Allina's credit rating at AA- and Aa3, respectively, in the fourth quarter of 2014. The agencies pointed to Allina's continued profitability, but noted that it faces pressure from lower inpatient volume, reimbursement cuts, a competitive market and the investments it is making to transition (PDF) to value-based payment models.
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