Report: WB General patient care costs exceed income

Jun. 22—WILKES-BARRE — A new report shows that, among Luzerne County's three hospitals, Wilkes-Barre General spent more on patient care than it took in in Fiscal Year 2022.

The Health Care Cost Containment Council, an independent agency, released its "Financial Analysis 2022-volume one" on Thursday. It gives a variety of basic information for each of the state's "general acute care" hospitals and gives a statewide average. It also sorts the data into nine regions and gives a regional average. Luzerne County is in Region 6, which includes nine counties in the northeast corner of the state.

"A high-quality, cost-effective health care delivery system requires financially healthy hospitals and health systems," the report notes. "Since fiscal year 1989, the Pennsylvania Health Care Cost Containment Council (PHC4) has produced a series of financial reports measuring the financial condition and utilization of the Commonwealth's hospitals and health systems."

This report looked at data for fiscal year 2022. While a few hospitals run a fiscal year that parallels the calendar year, the report notes most hospitals set there fiscal year from July 1 through June 30. The 2022 fiscal year would be the one that ended June 30 of last year.

The report provides the "operating margin," defined as "the ratio of operating income to total operating revenue. It looks at the money made and spent on patient care. Most hospitals offer additional services such as cafeterias and gift shops for visitor, so the report provides the "total margin," which includes all spending and income. The report also breaks down the income and expenses for some calculations.

The data shows that two of three Luzerne County hospitals had income higher than expenses. Geisinger Wyoming Valley had an operating margin of 18.5% and a total margin of 21.96%. Of the 13 hospitals in Region 6, those were the second highest margins. Guthrie Troy Community Hospital in Troy, Bradford County, had higher margins, 23.78% and 23.83% respectively. Troy has much smaller revenues and expenses. For example, net patient revenues were $33 million, compared to $711 million at Geisinger Wyoming Valley.

Lehigh Valley Hazleton had an operating margin of 5.74% and a total margin of 14.72%. Wilkes-Barre General had the same negative rate for both operating and total margins: -4.26%. The average operating margin for the region was 8.34%, nearly double the statewide average of 4.36%. The total margin average for the region was even higher at 9.32%, while the state average was 4.29%.

The report noted that, overall, statewide operating income dropped substantially from 2021 to 2022, down from $4.4 billion to $2.5 billion, causing the state operating margin to drop from 8.2% in 2021 to 4.36%. Wilkes-Barre General was not alone in posting negative margins.

"As our Pennsylvania hospitals are continuing efforts to recover financially from the COVID-19 pandemic, our data shows that in FY22, 43% of Pennsylvania hospitals posted a negative total margin." said Barry D. Buckingham, Executive Director of the Council. "In addition, 39% of Pennsylvania hospitals posted a negative operating margin which indicates many hospitals continue to face serious financial challenges.

"In FY22, 43% of Pennsylvania hospitals posted a negative total margin, 10% posted a total margin between 0% and 4%, and the remaining 47% posted a total margin higher than 4%."

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Reach Mark Guydish at 570-991-6112 or on Twitter @TLMarkGuydish