Higher labor costs and struggling financial markets, combined with a fractious merger, dealt a multibillion-dollar blow to Providence’s 2022 financial performance.
The Catholic nonprofit health system posted a $6.12 billion net loss in 2022, compared to a $517.84 million profit in 2020. Results posted Thursday included a $3.41 billion related loss Providence split from Southern California Health System HoagEffective January 2022. The total investment deficit for the year was approximately $1 billion.
Providence also suffered a $246.64 million loss from restructuring costs, partly resulting from asset restructuring and job cuts. Last year, the health system streamlined operations, reduced its seven regional divisions to three and reduced its executive teamIn an effort to direct more resources to frontline workers.
Annual operating revenue declined 3.3% to $26.43 billion, including a 3.9% decline in patient services revenue. The system had about 33,000 fewer patient admissions in 2022. Inpatient procedures were down 3.2%, and outpatient procedures were down 6.9%.
Expenses for salaries and benefits increased by 2.6% to $14.33 billion, although total operating expenses decreased by less than 1% to $27.89 billion.
Based in Renton, Washington, Providence has 51 hospitals and more than 1,000 clinics spread across seven states.
Providence is not alone in its financial woes. of Ohio Cleveland Clinic reports losses of over $1 billion In 2022. based in Oakland, California Kaiser Permanente reported a net loss of $4.5 billion during the year. The Mayo Clinic in Rochester, Minnesota, made a profit of $2.2 billion.But this was a drop of over 50% from the previous year.