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January 04, 2018 12:00 AM

Hospital profits continued their rise in 2016

Tara Bannow
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    Profits at the more than 4,800 U.S. community hospitals rose 3.8% in 2016, climbing to $76.1 billion, from $73.3 billion a year earlier. The trend follows years of steadily increasing profits.

    Total net revenue reached $979 billion in 2016—including nursing home results—and expenses were $903 billion, according to the 2018 edition of the American Hospital Association's Hospital Statistics report aggregating hospital financial and utilization trends, which was released Thursday. The annual report includes data on all 4,840 registered community hospitals in the U.S.—159 fewer than in 2012.

    Meanwhile, community hospitals' total cost of uncompensated care, which includes free and discounted care for low-income patients plus bills that went unpaid, jumped to $38.3 billion in 2016, diverging from two years of decreases.

    Uncompensated care has declined since the Affordable Care Act expanded healthcare coverage through Medicaid and subsidized private plans in 2014, reducing the number of patients who needed help paying bills. In 2013, uncompensated care had hit a peak of $46.4 billion. That number dropped to $42.8 billion in 2014, and to $35.7 billion in 2015.

    The AHA data show community hospital profits have risen 43% since 2011, when they were $53.2 billion.

    Inpatient admissions, including in systems' nursing home units, increased slightly in 2016 to 33.4 million, about 164,000 visits higher than in 2015 and about 357,000 visits higher than in 2014. Inpatient admissions fell about 5% between 2011 and 2014 before inching up again.

    Outpatient visits, by contrast, have stayed consistently on the upswing since at least 2011. Health systems recorded 747 million outpatient visits in 2016, a 12% increase from 656 million in 2011.

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