Thursday, October 10, 2013

Georgia Non-Profit Hospitals Net Assets Up 55% Under Obama and the Affordable Care Act

From a review of the Electronic Municipal Market Access (EMMA), I found a large number of 10 Non-Profit Hospital Organizations headquartered in the State of Georgia with Net Assets at the most recent date reported of more than $400 mil each.  Below here are the Net Assets of these 10 at both the most recent reported date and also at the beginning of the Obama Administration:

2008 2008 Obama

or or ACA

Most Recent
2009 2009 and

Recent Balance
FYE Balance US Fed

Balance Sheet
Balance Sheet Bump
City State Sheet Net
Sheet Net %
Hospital Organization HQs HQs Date Assets
Date Assets Change

mil $s

mil $s
Children's HealthCare Atlanta Atlanta GA  Jun 13      2,867
Dec 08     1,482 93%
Wellstar Health System Marietta GA Mar 13     1,111
Jun 09        715 55%
Piedmont Health Care Atlanta GA Jun 13        961
Jun 09        608 58%
Central Georgia Health System Macon GA Sep 12        920
Sep 09        789 17%
Phoebe Putney Health System Albany GA Jul 13        664
Jul 09        481 38%
Northeast Georgia Health System Gainesville GA Jun 13        543
Sep 09        307 77%
University Health Augusta GA Dec 12        481
Dec 08        317 52%
Archbold Medical Center Thomasville GA Jun 13        465
Sep 09        364 28%
Gwinnett Hospital System Duluth GA Jun 13        434
Jun 09        327 33%
Hamilton Health Care System  Dalton GA Jun 13        404
Sep 11        335 21%

Total all 10


     5,725 55%

As you can see from the above chart, the Total Net Assets of these 10 Georgia Non-Profit Hospital Organizations increased by a very robust 55% to $8.850 bil during the Obama Administration.

I think reviewing what has happened with Children's HealthCare Atlanta during the Obama Administration is very helpful since similar things have been going on all throughout the Non-Profit Hospital sector.

Children's HealthCare Atlanta generated a $478 mil Bottom Line Loss in annual 2008, mainly due to a $452 mil Investment Loss caused by the late 2008 financial meltdown.

So what has happened since?  Well, for the 4.5 years since, from the beginning of 2009 to June 30, 2013, Children's HealthCare Atlanta generated a Total Bottom Line Profit of $1.240 bil, an off-the-charts 26.6% of its Total Revenues.  Its Total Investment Income over that 4.5 years was $686 mil, a monstrous 55% of its Total Bottom Line Profits.  These spectacular Investment Returns were due to low interest rates and an extremely robust stock market.

Wellstar Health System generated Total Bottom Line Profits (Excess of Revenues over Expenses) of $506 mil in the 3.75 years through March 2013, which was a very high 9.5% of its Total Revenues over the same time period.  This 9.5% Bottom Line Profit Margin is just slightly lower than the 9.6% Combined Bottom Line Profit Margin of the 30 prestigious Dow Industrial companies.  Does this make any sense?  Absolutely none.

Piedmont Health generated Total Bottom Line Profits of $375 mil in the most recent four years, which was a high 6.9% of its Total Revenues over the same time period. 

Very positively impacting this major increase in the Net Assets (Financial Strength) of these hospitals were actions taken by both the Obama Administration and the US Fed to strengthen the US Financial Foundation which was severely damaged from the financial meltdown in late 2008.

In addition, the Affordable Care Act (ACA) has also played a key role in this increase in Net Assets (Financial Strength) of these Non-Profit Hospital Organizations.

A remarkable thing is that these robust increases in Net Assets of these Non-Profit Hospital Organizations occurred when these Non-Profit Hospitals were also able to substantially bend down the Total US Health Care Cost Curve in each of the most recent three years.

With future Non-Profit Hospital Organizations' Hospital Operating Income being bolstered by both many of the Uninsured getting insurance and by the many of the Underinsured getting much better insurance, both under the ACA,  future Net Asset growth of these Non-Profit Hospital Organizations should be very robust.  And for States electing to expand Medicaid, this future Net Asset growth will be exceptionally robust.