ProHealth Care had better operating results for its fiscal 2015 as it saw a spike in outpatient visits and benefitted from a Medicare program that incentivizes high-performing accountable care organizations.
Outpatient visits at the Waukehsa, Wis.-based system increased 5.7% over the prior year, as clinic and urgent=care visits rose 3.5% over fiscal 2014. Admissions, however, fell 3.8% from the prior-year period.
ProHealth joined the nationwide trend of increased outpatient care. According to a study released in January by the American Hospital Association, outpatient visits were up 1.2% in 2013 from 2012, to more than 787 million visits.
The increase in ProHealth's outpatient utilization drove its net patient revenue up 5.9% over 2014, and the system also credited the revenue uptick to an improved payer mix and a revenue cycle focused on timely collections. The system's ACO, ProHealth Solutions, received a $2.8 million Medicare shared incentive payment. The Medicare shared savings program is an ACO model that encourages cooperation and coordination among providers. According to ProHealth's financial report, it was one of 92 out of 333 total participating ACOs in the country that lowered costs and improved quality of care.
Overall, the system saw $37.8 million in income on $748.3 million in total revenue in fiscal 2015, compared to $16.8 million in income on $708.1 million in revenue in 2014.
ProHealth, however, also experienced a 2.8% rise in total operating expenses, which included the system paying 3.6% more in salaries and wages in 2015. ProHealth also paid 7.1% more in benefits, which the system attributed to unfavorable health and dental costs under its self-insured plan, and the fact that 76% of health and dental claims were from services provided by ProHealth.
Additionally, medical supply and drug costs were up 7% from 2014. ProHealth isn't the only system to be experiencing higher drug costs, and those rising costs are wreaking havoc on systems' finances around the U.S., according to Modern Healthcare's latest CEO Power Panel survey. The survey found that 90% of responding CEOs said rising drug costs were undermining their finances, with almost half stating the impact was “very negative.” A whopping 86% of survey respondents said they supported giving the federal government the authority to negotiate drug prices on behalf of Medicare and Medicaid beneficiaries.
