A new study issued by the Thomas Jefferson Institute for Public Policy shows that the overall finances of Virginia hospitals are healthy.
Using numbers posted on the Virginia Hospital Information website, the Institute compared the figures with those posted in previous years. They demonstrated that, while hospital profits remained flat since last year, hospital net worth has increased by $1.1 billion, and the number of hospitals operating at a deficit has dropped by 20 percent.
More important is the bigger picture: Since 2012, hospital profits have risen from $1.58 billion to $1.89 billion, hospital net worth has risen from $14.75 billion to $17.8 billion, and the number of hospitals operating at a deficit has fallen from 42 to 27.
“These are not the numbers of an industry in desperate financial trouble,” said Michael Thompson, president of the Thomas Jefferson Institute and author of the study.
“This year’s study, Virginia’s Hospitals: Doing Well in a Sluggish Economy, shows that the hospitals enjoyed an overall profit of basically the same as last year — $1.89 billion. And, as profits remained stable, the net worth of our hospitals increased by 6.6% or over $1.1 billion,” said Thompson in a statement.
“And to illustrate the growing economic strength of our hospitals in yet another way, once again fewer hospitals are running a deficit. As a matter of fact, over the past four years – from 2012 through 2015 – the number of hospitals running in the red has decreased by 35% — from 42 in 2012 to 27 in 2015.
This year’s report also shows that in every region of the state, our hospitals as a whole are running profitably although two of the five regions show less profit than last year. And in each of the five regions the hospitals showed an increase in their net worth.
This year’s report also lists the compensation of the non-profit hospitals’ CEO’s as listed in Guidestar and in the Richmond Times Dispatch. The total compensation for the CEO’s of Virginia’s non-profit hospitals ranged from $230,748 to $6,000,797.
The Virginia Hospital and Healthcare Association (VHHA) argues for the continuation of monopoly services through the Certificate of Public Need laws, and advocates for an expansion of Medicaid because it says that its membership is on shaky financial ground.
However, this year’s annual study shows that the overall hospital industry here in Virginia continues to get stronger and stronger.”
The graphs below show the financial progress of Virginia hospitals over the past four years, during a time of a devastatingly sluggish economy in the Commonwealth.
The study may be found on the Thomas Jefferson Institute website by clicking here.
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