Iasis Healthcare, a privately held hospital chain that filed for an initial public offering this year, reported higher revenue from both its hospital and health plan divisions in its fiscal third quarter.
Over the past two years, Iasis has divested hospitals in Florida and Nevada to focus on its core markets and its more profitable managed-care business.
The Franklin, Tenn.-based company reported higher acute-care revenue as it saw a greater number of admissions during the quarter ended June 30. Its health plan division, Health Choice, also saw a rapid increase in lives and lower medical claims.
Hospital admissions increased 0.1%, or 2.3% when adjusted for outpatient activity. When the numbers were further adjusted for service-line closures, admissions were up 0.9% and adjusted admissions 3.1%.
The higher volume contributed to a 4.6% increase in acute-care revenue.
Health Choice, meanwhile, increased the total number of lives in its managed-care products to 389,900—an 83.1% increase. Those numbers included a 22.2% increase in lives in its managed Medicaid, Medicare and exchange plans.
Moreover, it was able to bring its medical-loss ratio down to 87.4% in the quarter, a decrease from 97.4% during the prior-year period. Iasis attributed the higher medical claims last year to more frequent utilization and higher-acuity conditions among members who had gained coverage under Arizona's expanded Medicaid program. Those costs came down as the health plan was able to more effectively manage their care, according to the company.
Iasis reported a third-quarter profit from continuing operations of $1.4 million on $686.3 million in revenue compared with a net loss of $11.3 million on $632.7 million in revenue in the prior-year period.
The company incurred $3.1 million in startup costs related to a new hospital campus and $5.9 million in costs from an unspecified legal settlement.
Iasis is currently backed by private equity firm TPG and in February filed for an IPO that could raise up to $100 million.