For-profit Universal Health Services said Monday it plans to give back the COVID-19 stimulus grants it received in the first quarter of 2021.
The King of Prussia, Pa.-based acute-care and behavioral health provider said it will return all $188 million in grants recorded during the quarter ended March 31. The grants were part of the Coronavirus Aid, Relief, and Economic Security Act's Provider Relief Fund. UHS said it has begun coordinating the return—expected to take place in the second quarter—using a portion of its cash and cash equivalents held on deposit.
The company recorded $209 million in profit in the recently ended quarter not including the grants, up 47% from the prior-year period, which includes the first few weeks of the pandemic's first wave. First-quarter revenue grew 6.5% year-over-year to $3 billion. Expenses grew at a slower clip, climbing almost 5% year-over-year to $2.7 billion.
UHS did not return the more than $400 million in CARES Act grants it recorded in 2020. The company said it has repaid early the $695 million in accelerated Medicare payments the company received in 2020.
The boost in profit comes even as admissions to UHS' acute-care hospitals declined 12% year-over-year on a same-facility basis. That's partially because the health system continues to benefit from the same tailwinds as its peers. HCA Healthcare said last week that patients tended to be sicker and more likely to have commercial insurance in the first quarter. As a result, UHS' net revenue per adjusted admission spiked 26% year-over-year.
Its behavioral admissions declined almost 5% year-over-year on a same-facility basis. Net revenue per adjusted admission grew 6.2%.
UHS noted in its release that the pandemic continues to negatively affect its operations and financial results since the second half of March 2020. It did not provide full-year guidance.
"The ultimate impact of the COVID-19 pandemic is highly uncertain and subject to change," the company said. "We are not able to fully quantify the impact that these factors will have on our future financial results."