Monday, March 17, 2014

West Virginia Non-Profit Hospitals Net Assets Up 89% Under Obama and the Affordable Care Act

From a review of the Electronic Municipal Market Access (EMMA), I found two Non-Profit Hospital Organizations headquartered in the State of West Virginia with Net Assets (i.e. Financial Strength or Total Assets minus Total Liabilities) at the most recent date reported of more than $400 mil each.  Below here are the Net Assets of these two 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




Most
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









CAMC Health System Charleston WV  Dec 13          518
Dec 08           211 145%
West Virginia United Health System Fairmont WV  Dec 13       1,033
Dec 08           608 70%









Total of both


     1,551

          819 89%

As you can see from the above chart, the Total Net Assets (Financial Strength) of these two West Virginia Non-Profit Hospital Organizations increased by a spectacular 89% during the first 5.00 years of the Obama Administration.  And just in the past 6 months, this Net Asset growth increased from 79% to 89%.

Very positively impacting this major increase in the Net Assets (Financial Strength) of these 2 West Virginia 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 2 West Virginia 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 substantial Net Asset percentage increases of these 2 West Virginia Hospitals, a key beneficiary of this will be West Virginia citizens electing to buy health insurance on the Federal Health Insurance Exchange.  This spectacular Net Asset growth gives these West Virginia 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. 

So Many Struggling West Virginia Hospitals

From West Virginia's excellent health website, there were 61 West Virginia Hospitals in 2012.  Of these 61 West Virginia Hospitals, an amazingly high 35 of them, or 57% of them, posted Losses from  Patient Services in 2012.  In the chart below are these 61 Hospitals:
 

2012
2012

Income
Income

(Loss) 2012 (Loss)

From Net Margin: 

Patient Patient Patient
 
Services Revenues Services

$000s $000s %
General Acute Care Hospitals


Welch Community               (8,785)              21,635 -40.6%
Weirton Medical             (13,772)              77,819 -17.7%
Williamson               (4,224)              29,434 -14.4%
Bluefield Regional               (9,304)              71,893 -12.9%
Reynolds Memorial               (3,021)              33,423 -9.0%
Thomas Memorial             (13,004)             147,484 -8.8%
St Joseph's               (2,843)              37,826 -7.5%
CamdenClark             (11,207)             223,581 -5.0%
Pleasant Valley               (2,881)              61,136 -4.7%
Summersville               (1,800)              43,375 -4.1%
Fairmont General               (2,575)              75,697 -3.4%
Wetzel County                  (539)              23,699 -2.3%
Stonewall Jackson                  (844)              39,756 -2.1%
Wheeling               (3,694)             258,438 -1.4%
United Hospital               (2,903)             225,805 -1.3%
St Francis               (1,132)              98,706 -1.1%
Jackson General                  (233)              23,410 -1.0%
Davis Memorial                  (461)              75,992 -0.6%
Ohio Valley                  (535)              96,286 -0.6%
WVU Hospitals               (2,588)             640,367 -0.4%
CAMC                7,230             768,763 0.9%
City Hospital                1,733             135,645 1.3%
Princeton                2,099             117,569 1.8%
Cabell Huntington                8,951             378,754 2.4%
St Mary's                8,848             348,032 2.5%
Monongalia General                8,645             209,168 4.1%
Beckley ARH                3,196              77,160 4.1%
Logan Regional                8,917              97,741 9.1%
CAMC Teays Valley                5,907              57,765 10.2%
Raleigh General              18,391             164,704 11.2%
Greenbrier Valley              14,765              71,138 20.8%
Charlestown Surgical                6,073              18,167 33.4%


   
Total all 32                8,410          4,750,368 0.2%




Critical Access Hospitals


Hampshire               (3,017)              17,279 -17.5%
Minnie Hamilton               (1,909)              14,815 -12.9%
Summers ARH               (1,294)              13,798 -9.4%
Braxton County               (1,258)              13,460 -9.3%
War Memorial               (1,572)              16,977 -9.3%
Roane General               (1,294)              22,096 -5.9%
Grant Memorial               (1,484)              28,949 -5.1%
Pocahontas                  (343)                9,710 -3.5%
Sistersville General                  (255)              10,253 -2.5%
Broaddus                  (334)              14,484 -2.3%
Grafton City                  (364)              17,682 -2.1%
Potomac Valley                  (307)              19,677 -1.6%
Montgomery                    (74)              20,156 -0.4%
Boone Memorial                   510              19,753 2.6%
Preston Memorial                   730              24,201 3.0%
Jefferson                2,346              43,740 5.4%
Webster County                   845              11,694 7.2%
Plateau Medical                3,712              36,027 10.3%




Total all 18               (5,362)             354,751 -1.5%




Long-term Acute Care


Cornerstone                4,533              15,895 28.5%
Select Specialty                1,325              16,763 7.9%




Total of both                5,858              32,658 17.9%




Psychiatric Hospitals


Mildred Bateman             (26,710)              10,172 -262.6%
Sharpe             (33,919)              13,369 -253.7%
River Park                   430              25,233 1.7%
Highland                   324              11,838 2.7%

   

Total all 4             (59,875)              60,612 -98.8%




Rehabilitation Hospitals


Huntington Rehab                3,116              17,712 17.6%
Mountainview                3,777              28,881 13.1%
Peterson Rehab                3,673              22,530 16.3%
Southern Hills                2,112              13,910 15.2%
Western Hills                2,655              17,266 15.4%




Total all 5              15,333             100,299 15.3%




Grand Total all 61             (35,636)          5,298,688 -0.7%

When a State posts a Total Net Operating Loss from Patient Services for all of its 61 Hospitals combined of $(35.6) mil and further when 57% of its Hospitals post Losses, then the State has a weak health care financial status which needs to be quickly corrected.

By far the best and only wise way to put a major dent in the huge widespread Operating Losses and very modest profits of the many struggling West Virginia Hospitals is for the State of West Virginia to fully expand Medicaid, which it wisely has done.  There will be a resultant huge inflow of Patient Revenues from Medicaid expansion, and thus these struggling West Virginia Hospitals will be able to substantially improve their Hospital profitability.

In addition, one of the key beneficiaries of the resultant very healthy profit improvement and thus also Total Net Assets improvement of all West Virginia Hospitals due to Medicaid expansion in West Virginia will be West Virginia citizens electing to buy health insurance on the Health Insurance Exchange.  This exceptional Net Asset growth from Medicaid expansion will give all West Virginia 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.