St. John’s Health saw net revenue in the first six months of the fiscal year grow by $10 million over the previous year, its trustees learned Thursday.
“That is not all orthopedics,” Trustee Scott Gibson told the board. “It’s the indication of the accomplishment of our strategy of diversifying our streams of revenue.”
Changes in the hospital’s services drove the increase. Chief Financial Officer John Kren told the Jackson Hole Daily that a few departments led the charge: cardiology, pulmonology and oncology.
New treatments like brachytherapy are a part of why those departments have steered the profit line higher. They are part of the hospital’s long-term vision to offer more services that induce patients to stay in town while treating diseases like cancer.
With increased volume comes more spending. Expenses have risen, Kren said, though more slowly than revenue. That has given St. John’s a $1 million operating profit for the first half of the year, Gibson said.
“We should be about break-even at the end of the year,” he told the trustees.
The predicted drop in profit is in part due to a winter slump the hospital sees most years, Kren said. The first three months of the calendar year are usually the hospital’s slowest, so revenue likely will drop before it ticks back up in May or June.
Even with the positive financial numbers, St. John’s saw its profits dragged down by health care costs. Some large entities, such as hospitals, are self-insured, meaning they cover the cost of employees’ health care rather than paying a set premium to an insurance provider.
Blue Cross Blue Shield administers St. John’s plan, meaning the hospital makes the payments, but it receives the benefits of the insurance company’s negotiated rates with providers around the country. Being self-insured has long-term cost benefits, Kren said, but a few very sick employees can cost the hospital large sums.
A couple of employees have had high costs during the past six months, with a few others also helping to jack up the costs.
“That’s not uncommon,” Kren said. “Often it’s five to 10 people using the majority of the services. It’s not the same people every year.”