Iasis Healthcare improved its finances on an adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) basis in its fiscal first quarter ended Dec. 31, despite regulatory problems following a shooting at its St. Joseph Medical Center in Houston.
During an earnings call Tuesday, Iasis Chief Financial Officer John Doyle said St. Joseph lost some patient volume in the first quarter. Although the system's improvement agreement with the CMS is now in place, the hospital will continue to feel some effects from those actions in the second quarter, including higher costs for consulting and training under the agreement, Doyle said.
After hospital security guards shot and wounded an unruly, unarmed man at St. Joseph in August, the CMS inspected the hospital and found it was not in compliance with Medicare's basic health and safety regulations.
In November, the CMS notified 374-bed St. Joseph that it might terminate its Medicare and Medicaid agreements. But last month, Iasis reached a systems improvement agreement with the CMS to ensure that the medical center can continue to see patients insured by Medicare and Medicaid.
Doyle said St. Joseph voluntarily took 18 beds out of service. Based in Franklin, Tenn., Iasis owns 17 acute-care hospitals and a behavioral-care hospital.
Outside of Houston, Iasis saw strong new business at its hospitals and with its managed-care plan, CEO Carl Whitmer said on the earnings call.
Revenue for the first quarter jumped 19.9% to $802.8 million, up from $669.5 million in the prior-year quarter.
Adjusted EBITDA for the first quarter totaled $57.4 million, compared with $55.9 million in the prior-year quarter. Iasis posted a net loss from continuing operations before income taxes for the first quarter of $3.8 million, compared with $3.0 million in the prior-year quarter.
Acute-care revenue in the quarter increased 5.4% on a 3.4% increase in net patient revenue per adjusted admission.
Premium and service revenue from Iasis' managed-care platform soared 52.8% to $313.3 million as total lives served, including in Arizona and Utah, jumped 86% to 628,000 in the quarter.
Whitmer and Doyle declined to take questions on the call because the company, which is predominantly owned by private-equity firm TPG Capital, is in a quiet period in advance of a planned initial public offering of common shares. Iasis filed its shelf registration last February to raise up to $100 million in the IPO.