Most Central Mass. hospitals were profitable in 2014
Ten of 11 acute-care hospitals in Central Massachusetts were profitable last year, although altogether they had the lowest margin among seven regions in the state, according to a report by the Massachusetts Center for Health Information and Analysis (CHIA).
MetroWest Medical Center, in Framingham and Natick, lost $6 million (total margin -2.4 percent), CHIA said. Out of 62 hospitals studied, it was one of eight that lost money in fiscal 2014, according to the report, “Massachusetts Acute Hospital Financial Performance,” published this week.
The report said that profitability improved for acute hospitals statewide in fiscal 2014 relative to fiscal 2013. Eighty-seven percent, or 54 acute hospitals, reported positive total margins in fiscal 2014, with the statewide median increasing slightly from 4.1 percent in fiscal 2013 to 4.2 percent in fiscal 2014. Similarly, operating margin improved; fewer hospitals reported a negative operating margin in fiscal 2014, and the statewide median operating margin rose from 2.3 percent in fiscal 2013 to 2.6 percent in fiscal 2014.
Saint Vincent Hospital in Worcester turned the highest profit, at $65.2 million (total margin 15.6 percent). The others, in order, were:
• UMass Memorial Medical Center , Worcester, $19.8 million (total margin 1.3 percent);
• Milford Regional Medical Center, $7.9 million (total margin 4.2 percent);
• Heywood Hospital, Gardner, $4.3 million (total margin 4.1 percent);
• HealthAlliance Hospital, Leominster, $3.9 million (total margin 2.4 percent);
• Harrington Memorial Hospital, Southbridge, $3.3 million (total margin 2.8 percent);
• Nashoba Valley Medical Center, Ayer, $3.2 million (total margin 6.4 percent);
• Marlborough Hospital, $2.9 million (total margin 3.6 percent);
• Athol Hospital, $1.4 million (total margin 6.2 percent); and
• Clinton Hospital, $200,000 (total margin 0.6 percent).
HealthAlliance, Clinton and Marlborough hospitals are subsidiaries of the UMass Memorial Health Care system, as is UMass Memorial Medical Center.
At $200.1 million, Massachusetts General Hospital recorded the largest profit of the 62 acute-care hospitals reviewed, followed by another Boston institution, Brigham and Women’s Hospital, with a profit of $151.7 million. Both had total margins of 6.0 percent in fiscal 2014.
Quincy Medical Center, which has since closed, recorded the highest loss at $39.1 million (total margin -57.0 percent).
The nine teaching hospitals examined, including Saint Vincent, had the highest median total profit margin at 8.2 percent, and the highest median operating margin at 5.6 percent. UMass Memorial – which had an operating margin of 1.1 percent – falls into a different group as an academic medical center. Other hospitals were classified as community hospitals, community-DSH (disproportionate share) hospitals, and specialty hospitals.
To determine hospitals’ financial health, CHIA examined: total margin, operating margin, non-operating margin, current ratio, days in accounts receivable, average payment period, debt service coverage, cash flow to total debt, and the equity financing ratio. Metrics included in the report are based on financial information from year 2012 to fiscal 2014.
The report notes that for the majority of the hospitals examined, the fiscal 2014 ending date is Sept. 30, 2014. MetroWest Medical Center and St. Vincent Hospital have June 30 year ends.
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