Tuesday, March 18, 2014

Oregon Non-Profit Hospitals Net Assets Up 61% Under Obama and the Affordable Care Act

From a review of the Electronic Municipal Market Access (EMMA), I found 4 Non-Profit Hospital Organizations headquartered in the State of Oregon with Net Assets (i.e. Financial Strength or Total Assets minus Total Liabilities) at the most recent date of more than $400 mil each.  Below here are the Net Assets of these 4 at both the most recent reported date and also at the Fiscal Year End (FYE) closest to the beginning of the Obama Administration:

FYE Balance Net

Balance Sheet Assets

Most Recent
Sheet Net %

Recent Balance
Date Assets Change

Balance Sheet
Beginning Beginning During
City State Sheet Net
Obama Obama Obama
Hospital Organization HQs HQs Date Assets
Admin Admin Admin

mil $s

mil $s

Oregon Health & Science University Portland OR Dec 13     2,291
Jun 09       1,570 46%
Legacy Health System Portland OR Dec 13     1,034
Mar 09          618 67%
Asante Health System Medford OR Dec 13        581
Sep 09          294 98%
St Charles Health System Bend OR Dec 13        447
Dec 08          227 97%

Total all 4


      2,709 61%

As you can see from the above chart, the Total Net Assets (Financial Strength) of these 4 Oregon Non-Profit Hospital Organizations increased by a very impressive 61% to $4.353 bil during their average 4.63 years so far of the Obama Administration.

The lowest percentage increase of the 4 was a robust 46%.

Very positively impacting this major increase in the Net Assets (Financial Strength) of these 4 Oregon 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 4 Oregon Non-Profit Hospital Organizations.

A remarkable thing is that these robust increases in Net Assets (Financial Strength) of these Non-Profit Hospital Organizations occurred when these Non-Profit Hospitals were also playing very instrumental roles in the substantial annual percentage growth reduction of Total US Health Care Costs which occurred in each of the most recent three years under the ACA.

With such very impressive Net Asset percentage increases of these 4 Oregon Hospitals, a key beneficiary of this will be Oregon citizens electing to buy health insurance on the Health Insurance Exchange.  This exceptional Net Asset growth gives these Oregon Hospitals the financial flexibility to moderate their pricing for hospital procedures in their negotiations with health insurance companies which ultimately determines what insurance premium prices are set at by health insurance companies on the Health Insurance Exchange.  

Providence Health Services Hospitals in Oregon

Washington headquartered Non-Profit Hospital Organization giant Providence Health Services had Total Net Assets in its Oregon Hospitals of $2.196 bil at December 31, 2013.  They are not included in the above 4.

Oregon Struggling Hospitals

The State of Oregon is being very transparent with its citizens by having available for review annually at its Health Information website very detailed financial information on each of its 58 individual Hospitals.  The most recent financial information is for 2012.

These 58 Oregon Hospitals had a Total Operating Income of $445 mil in 2012 which was a seemingly respectable Goldilocks 4.6% of their Total Operating Revenues of $9.768 bil.  And these 58 Oregon Hospitals' Total Operating Income of $445 mil in 2012 was burdened with an Earnings Charge of $432 mil due to Total Provisions for Bad Debts.  In addition, their Total Uncompensated Charity Care Costs were another $788 mil in 2012.

But you have to stratify these Hospitals to find out what is really going on with Oregon Hospitals.

First, let's look at the upper end Oregon Hospitals.  There were 20 Oregon Hospitals generating an Operating Income Margin of higher than 5.0%.  These 20 High Profit Oregon Ducks generated a Total Operating Income Margin of a very healthy 8.1%.

But on the downside, there were 17 Oregon Hospitals which had Operating Losses and another 14 with very modest Operating Income Margins of 0.0% to 2.5%.

Below here are these 58 Oregon Duck Hospitals:
Hospital Name Operating Income Total Operating Revenue Operating Margin
High Profit Oregon Duck Hospitals
Willamette Valley Medical Center $26,391,068 $87,155,146 30.3%
St. Anthony Hospital $8,163,090 $52,810,122 15.5%
Legacy Meridian Park Medical Center $18,529,000 $164,058,000 11.3%
Good Shepherd Medical Center $9,099,962 $82,731,260 11.0%
Curry General Hospital $2,777,252 $27,291,312 10.2%
PeaceHealth Peace Harbor Hospital $6,311,554 $66,177,014 9.5%
McKenzie-Willamette Medical Center $11,655,614 $125,243,590 9.3%
Providence St. Vincent Medical Center $69,235,615 $778,414,667 8.9%
Sky Lakes Medical Center $15,123,968 $170,856,141 8.9%
Mercy Medical Center $16,519,969 $189,526,833 8.7%
Asante Rogue Regional Medical Center $33,141,135 $385,937,435 8.6%
Columbia Memorial Hospital $5,361,710 $69,402,998 7.7%
St. Charles Medical Center-Bend $30,256,083 $400,541,429 7.6%
Kaiser Sunnyside $38,159,359 $527,916,560 7.2%
OHSU Hospital $80,948,767 $1,177,580,581 6.9%
Santiam Memorial Hospital $2,166,728 $32,082,700 6.8%
Providence Milwaukie Hospital $5,674,906 $86,830,756 6.5%
West Valley Community Hospital $1,315,947 $20,288,531 6.5%
Legacy Mt. Hood Medical Center $5,572,000 $102,273,000 5.4%
PeaceHealth Sacred Heart-Riverbend $29,055,557 $570,546,890 5.1%
Total all 20 High Profit Ducks $415,459,284 $5,117,664,965 8.1%
Modest Profit Oregon Duck Hospitals
Providence Newberg Medical Center $4,072,861 $84,472,090 4.8%
Grande Ronde Hospital $2,968,598 $66,238,914 4.5%
Bay Area Hospital $4,822,497 $127,320,291 3.8%
Providence Medford Medical Center $5,226,229 $161,642,813 3.2%
Providence Hood River Memorial Hospital $2,038,930 $67,497,222 3.0%
St. Alphonsus Medical Center-Baker City $938,000 $31,222,000 3.0%
Samaritan Pacific Communities Hospital $1,844,680 $64,430,134 2.9%
Total all 7 Modest Profit Ducks $21,911,795 $602,823,464 3.6%
Very Modest Profit Oregon Duck Hospitals
Legacy Good Samaritan Medical Center $6,883,000 $282,847,000 2.4%
St. Charles Medical Center-Redmond $1,645,060 $69,295,182 2.4%
Adventist Medical Center $6,338,105 $296,947,898 2.1%
Samaritan Lebanon Community Hospital $1,493,129 $83,399,177 1.8%
Samaritan Albany General Hospital $2,241,919 $129,054,081 1.7%
Mid-Columbia Medical Center $1,540,407 $99,271,947 1.6%
Wallowa Memorial Hospital $268,150 $17,405,152 1.5%
Providence Portland Medical Center $8,375,581 $630,412,168 1.3%
St. Alphonsus Medical Center-Ontario $814,473 $61,681,724 1.3%
Asante Three Rivers Medical Center $1,703,877 $129,516,770 1.3%
Providence Seaside Hospital $442,403 $45,928,988 1.0%
Salem Hospital $4,625,515 $519,362,207 0.9%
Coquille Valley Hospital $117,478 $16,497,087 0.7%
Providence Willamette Falls Medical Center $3,434 $92,075,156 0.0%
Total all 14 Very Modest Profit Ducks $36,492,531 $2,473,694,537 1.5%
In-The-Red Oregon Duck Hospitals
Tuality Healthcare ($167,000) $166,679,600 -0.1%
Legacy Emanuel Medical Center ($1,975,000) $571,284,000 -0.3%
St. Charles Medical Center-Madras ($211,811) $25,102,346 -0.8%
Samaritan North Lincoln Hospital ($743,695) $43,619,890 -1.7%
Good Samaritan Regional Medical Center ($5,505,284) $321,736,685 -1.7%
Harney District Hospital ($279,321) $14,848,609 -1.9%
PeaceHealth Sacred Heart-University District ($2,234,213) $103,946,623 -2.1%
Tillamook County General Hospital ($1,436,000) $52,443,000 -2.7%
Silverton Hospital ($3,017,720) $101,545,256 -3.0%
Lake District Hospital ($526,834) $17,482,867 -3.0%
Southern Coos Hospital and Health Center ($579,675) $13,722,284 -4.2%
Blue Mountain Hospital ($1,170,410) $16,702,858 -7.0%
Ashland Community Hospital ($3,583,567) $48,256,579 -7.4%
Pioneer Memorial Hospital-Prineville ($1,929,182) $24,703,453 -7.8%
Lower Umpqua Hospital ($1,498,551) $17,420,931 -8.6%
PeaceHealth Cottage Grove Community Hospital ($3,330,882) $27,748,857 -12.0%
Pioneer Memorial Hospital-Heppner ($912,667) $6,741,787 -13.5%

Total all 17 In-The-Red Ducks ($29,101,812) $1,573,985,625 -1.8%

Total all 58 Oregon Duck Hospitals $444,761,798 $9,768,168,591 4.6%

When you have 29% of your State Hospitals generating Operating Losses and 53% of your State's Hospitals with Operating Income Margins below 2.5%, you have a financial problem with your State's Hospitals that you have to quickly address.

By far the best and only economically good way to put a major dent in the Operating Losses of the many struggling Oregon Hospitals is for the State of Oregon to fully expand Medicaid, which they wisely have done.  Since Oregon did this, there will be a resultant massive inflow of Patient Revenues from Medicaid expansion, after all there were $432 mil of Total Provisions for Bad Debts Charges that reduced the Total Operating Revenues of all Oregon Hospitals in 2012.  In addition, there were huge Uncompensated Charity Care Costs of $788 mil in 2012.

With this massive inflow of Revenues due to Medicaid expansion in Oregon, the struggling Oregon Hospitals will be able to substantially reduce their Operating Losses and a huge majority of them should even be able to turn their losses into profits.  And due to Medicaid expansion, the Oregon Hospitals with very modest Operating Income will have their profits bolstered very robustly, as will the Oregon Hospitals now making higher than modest Operating Income.

Also since Oregon fully expanded Medicaid, another key beneficiary of the resultant very healthy profit improvement and thus also Total Net Assets improvement of all Oregon Hospitals will be the Oregon citizens electing to buy health insurance on the Health Insurance Exchange.  This exceptional Net Asset growth from Medicaid expansion should in all fairness give all Oregon Hospitals the financial flexibility to moderate their pricing for hospital and other health care procedures in their negotiations with health insurance companies which ultimately determines what insurance premium prices are set at by health insurance companies on the Health Insurance Exchange.