A spike in earnings from Medicaid patient visits did little to soften the blow to Orlando Health's operating margin in its fourth quarter.
The Orlando, Fla.-based not-for-profit saw its operating margin shrink to 0.9% from 7.4% a year ago.
The system, which operates eight hospitals, reported an operating surplus of $5.8 million on revenue of $593.3 million in its fourth quarter ended Sept. 30. The surplus was down 85% from the $41.5 million cleared on $555.9 million in revenue in the prior-year period.
Orlando attributes the drop to higher expenses caused by increased salary and benefit costs due to hiring more full-time employees to handle the increase in patient volume increases. Orlando says it was also hit by rising supply and drug costs. Expenses increased $73 million this quarter.
Unlike its quarterly earnings, Orlando's operating surplus grew in the fiscal year ended Sept. 30. It posted an operating surplus of $180.8 million on revenue of $2.3 billion, up 42% from a surplus of $127.2 million on revenue of $2.1 billion in fiscal 2014. The operating margin for the entire year rose slightly to 7.7%.
Orlando Health representatives did not immediately respond to requests for comment.
