Admitting a higher number of complex, sicker patients helped boost operating income at Mount Sinai Hospital 17% last year, even as admissions fell.
New York-based Mount Sinai, which in September 2013 entered a merger with Continuum Health Partners, ended 2014 with operating income of $74.8 million on revenue of $2 billion, up from $63.9 million on revenue of $1.9 billion the prior year, the hospital reported in financial statements. The financial statements are for Mount Sinai Hospital, not the newly merged system.
Inpatient revenue accounted for 70% of the system's total operating revenue last year and increased by $52.5 million in 2014 despite a 3% decline in discharges. That's because patients who were admitted to the hospital were sicker, the statements said.
The hospital will seek to continue its revenue growth by attracting more patients who are more acutely ill by recruiting cancer and cardiac physicians and surgeons, hospital management wrote
Outpatient revenue made up another 27% of the hospital's operating revenue. Mount Sinai Hospital is seeking to expand its ambulatory services. Outpatient revenue grew more rapidly than inpatient revenue, increasing $71 million.
Expenses increased 5% as management sought to hold down labor costs, which account for half of its operating budget. Labor costs increased 2%. However, supply costs grew 8% as a result of growth in demand for spine and orthopedic surgery, cardiac catheterization and oncology care.
The system will continue to focus on cost control as it seeks to boost revenue, management wrote. “Through strategic alignments and mergers, MSH's management continues to focus on developing and growing top-line revenue while controlling expenses as the best strategy to maintain progress and improvement.”
Net income for Mount Sinai Hospital declined to $133.5 million from $162.6 million, in part thanks to a drop in the unrealized value of its investment portfolio.
