|mils $s||mils $s||mils $s|
|Washington Non-Profit Hospital Organizations|
|Providence Health||Renton||Dec 2012||412||362||50||14%|
|MultiCare Health||Tacoma||Dec 2012||241||59||182||308%|
|Seattle Children's Healthcare||Seattle||Sep 2012||202||64||138||216%|
|Total all 4||951||442||509||115%|
Note: Providence Health's above Bottom Line Profits of $412 mil in the most recent year excludes $805 mil of Economic Gains from new Hospital Affiliations.
As you can see in the above chart, these 4 Washington State Non-Profit Hospital Organizations generated Total Bottom Line Profits of $951 mil in the most recent fiscal year, up an exceptional 115% from the previous year.
But there's much more to this earnings story.
When the Insurance Exchanges kick in starting in 2014, these Washington State Non-Profit Hospital Organizations should see their profits increase by substantially more.
Under the Affordable Care Act (ACA), Hospital Organizations' both future Hospital Operating Income and future Bottom Line Income will be bolstered robustly due to many of the Uninsured getting insurance and also due to the many of the Underinsured getting much better insurance. And since Washington is wisely Expanding Medicaid, the profits of all Washington Hospitals will be substantially increased by reducing the huge earnings charges related to both Bad Debts and Charity Care.
So what about the amounts of these two items.....Bad Debts and Uncompensated Charity Care? Well, they are very large, especially when compared to the related Hospital Operating Income, particularly in Washington which has a substantial overweighting of Catholic Hospitals.
From a review of the Electronic Municipal Market Access (EMMA), below here are the most recent audited year's Provision for Bad Debts and Uncompensated Charity Care Costs for the 3 Washington Non-Profit Hospital Organizations which had Net Assets above $400 mil currently. I excluded Seattle Children's Healthcare. And I included a 15% Washington allocation of Catholic Health Initiatives amounts, since Washington-based Franciscan Health System comprised 15% of Catholic Health Initiative's Consolidated Total Operating Revenues:
|mils $s||mils $s||mils $s||mils $s|
|Washington Hospital Organizations|
|Providence Health||Renton||Dec 2012||390||272||662||204|
|Wash 15% of Catholic Health Initiatives||Jun 2013||123||48||171||(8)|
|MultiCare Health||Tacoma||Dec 2012||132||35||167||159|
|Total all 4||806||423||1,229||365|
|Provision for Bad Debts||806|
|Estimated Costs of Uncompensated Charity Care||423|
|Operating Income Excluding Bad Debts and Uncompensated Charity Care Costs||1,594|
So, these 4 Hospital Organizations had Audited Total Hospital Operating Income of $365 mil in the most recent fiscal year. Driving down this $365 mil Total Hospital Operating Income were Total Provisions for Bad Debts of $806 mil and Total Costs of Uncompensated Charity Care of another $423 mil. Thus, exclusive of these two earnings charges, Total Hospital Operating Income would have been $1.594 bil, which is $1.229 bil higher than the reported $365 mil.
Granted these two earnings charges will not be totally eliminated with the ACA and in combination with States electing to Expand Medicaid, but a substantial amount of these two earnings charges will be eliminated, and especially so since Washington is electing to Expand Medicaid, which is the predominant driver of these two earnings charges being very substantially reduced.
And the above two earnings charges are just for one year.
With these very strong, ongoing Washington Non-Profit Hospital earnings under Obamacare, the ultimate result should be a reduction in hospital patient charges, a bending back of the US Long-term Total Health Care Cost Curve and a reduction in the US Debt.
That's quite a financial Trifecta!
And it also only makes sense that some of these huge past and future bottom line profits of these US Hospital Organizations, both Non-Profit and For-Profit ones, should be used to wisely fund a substantial portion of the elimination of the US Government Sequester Cost Cuts over the next say 3 to 4 years which are now being negotiated by 29 US Congressional members of the Bilateral and Bicameral Committee Conference on Budget Negotiations. Both clear-thinking Republicans and clear-thinking Democrats should be on board with this wise funding vehicle.
And lastly, it is just incredible how much the financial strength of these Washington State Non-Profit Hospitals has been enhanced during the Obama Administration.
From EMMA, below here are the Net Assets of these 4 Washington State Non-Profit Hospital Organizations at June 30, 2013 and also at the beginning of the Obama Administration:
|mil $s||mil $s|
|Providence Health||Renton||WA||Jun 13||6,757||Dec 08||3,911||73%|
|Seattle Children's Healthcare||Seattle||WA||Jun 13||1,759||Sep 09||1,195||47%|
|PeaceHealth||Vancouver||WA||Jun 13||1,617||Jun 09||897||80%|
|MultiCare Health System||Tacoma||WA||Jun 13||1,475||Dec 08||650||127%|
|Total all 4||11,608||6,653||74%|
Yeah, these 4 Washington State Non-Profit Hospital Organizations had their Total Net Assets increase by a massive $4.955 bil to $11.608 bil, an increase of a very robust 74% during the Obama Administration so far. This $4.955 bil Net Asset increase comes predominantly from the tax-free cumulative earnings of these Washington State Hospitals during the Obama Administration.