Bon Secours Mercy Health posted a $1.2 billion net loss in 2022, compared with a $997.7 million gain the prior year, the Catholic nonprofit health system disclosed this week. The change was largely driven by decreased returns on investment amid struggling financial markets.
Cincinnati-based Bon Secours Mercy's revenue rose 2.1% to $11.1 billion, while operating expenses rose 6.8% to $11.43 billion. Costs related to employee compensation alone jumped 9.6% to $5.93 billion.
In addition to rising labor costs, many health systems nationwide are struggling with inflated prices on supplies and pharmaceuticals, plus lost revenue from fewer hospital admissions.
Bon Secours Mercy's investment losses for 2022 totaled $925.33 million.
Bon Secours and Mercy Health merged in 2018, forming a system that operates 48 hospitals and more than 1,200 care sites across seven U.S. states and Ireland.
Bon Secours Mercy did gain $119.2 million from further reducing its stake in revenue cycle management operation Ensemble Health Partners, after already selling a majority stake to Golden Gate Capital in 2019. Another $58.3 million came from selling multiple senior living facilities in Ohio, part of the system's pivot away from skilled nursing and assisted living.
To curb financial losses, Bon Secours Mercy said it is reducing contract labor and spending less on external vendors. It expects to reach about $280 million in run-rate savings by the end of the year.