BJC Healthcare more than doubled its operating surplus in the first quarter of the year as patient volume increased, bad debt declined and the St. Louis-based system focused on managing its costs.
For the quarter ended March 31, BJC reported an operating surplus of $53.2 million (PDF) on $1 billion in revenue compared with an operating surplus of $23.8 million on $967.8 million in the prior-year period.
Admissions increased 4.4%, or 5.7% when adjusted for outpatient activity. Emergency room visits were up 7.6% while inpatient and outpatient surgeries increased a combined 1.2%.
The system's bad debt declined 11.7% despite its location in a state that did not expand Medicaid eligibility. But some patients may be picking up coverage on the private marketplace and Medicaid enrollment has generally increased because of the so-called woodwork effect generated by the publicity around the reform law's coverage expansions. About two-thirds of the insurance products being sold on the commercial exchange include BJC facilities, CEO Steven Lipstein said in a recent interview.
BJC's hospitals have also been tightly managing their expenses, Lipstein said. In late 2012, the system became one of the first to align itself with other regional health systems—to form the BJC Collaborative—in order to find economies of scale without giving up their independence.
After a strong 2014, BJC earlier this month issued $150 million in 30-year, fixed-rate bonds for a number of building projects, including consolidating its pharmacy services, creating new outpatient centers and expanding St. Louis Children's Hospital. Moody's Investors Service rated the bonds Aa2 and Standard & Poor's rated them AA.
