Home Industries Health Services Care New England reports $1.9M gain in Q2

Care New England reports $1.9M gain in Q2

By

Katie Castellani

-

05/21/2024

Kent Hospital — CARE NEW ENGLAND HEALTH SYSTEM continued its upward momentum posting a $1.9 million operating gain in the second quarter of 2024, according to unaudited financial statements released May 15. Pictured is Kent County Memorial Hospital, which is operated by CNE. / COURTESY KENT COUNTY MEMORIAL HOSPITAL

PROVIDENCE – Care New England Health System continued its upward momentum posting a $1.9 million operating gain in the second quarter of 2024, according to unaudited financial statements released May 15. The second-quarter earnings come after the health system reported a $566,145 operating gain in the first quarter. It also shows improvement over the same

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PROVIDENCE – Care New England Health System continued its upward momentum posting a $1.9 million operating gain in the second quarter of 2024, according to unaudited financial statements released May 15. The second-quarter earnings come after the health system reported a $566,145 operating gain in the first quarter. It also shows improvement over the same period last year when Care New England reported a $6.1 million operating loss. Net income for the quarter was $14.2 million, up from $5.3 million in the same period last year. Operating revenues were $354.8 million for the quarter, which is $35 million higher than the $319.8 million operating revenue reported during the same period last year and $11.3 million higher than the first quarter. The state’s second-largest health system’s revenue was boosted by net patient service revenue, which rose to $302 million for the quarter, up from $266.5 million reported last year and $294.9 million in the first quarter of 2024. Revenue was also supported by an increase in net assets released from restrictions and grant revenue or relief funding. Net assets released from restrictions rose to $1.9 million in the second quarter of 2024 from $422,940 during the same period last year. Grant revenue or relief funding totaled $925,077 for the quarter, up from $576,371 reported the previous quarter and the $259,095 reported during the same period last year. Operating expenses continued to rise, reaching $352.9 million for the second quarter, which is up from $325.9 million reported during the same period last year and $342.9 million reported in the first quarter of 2024. Licensure fees continued to affect expenses, going to $17.1 million in the first and second quarters of 2024 from $10.2 million last year. Spending on purchased services also continued to rise, going to $36.5 million in the most recent quarter from $27.4 million last year. Total assets were $1.05 billion for the quarter, a 7.4% increase from last year’s $979.1 million. Contributing to this was a rise in other receivables, which were $77.7 million through the second quarter, marking a $35.1 million increase over last year. The increase is mainly due to the timing of receipts from Rhode Island's Medicaid License Fee Program. The program’s disbursements tend to come before the receipt of funds and the health system expects it will benefit by an incremental $14 million by the end of the fiscal year. The health system reported $70.9 million in cash and cash equivalents and short-term investments, which is a $17.9 million decrease from last year’s $88.8 million. Management said the decline was caused by indemnity funding, as well as license fee payments for the state’s Medicaid License Fee Program. Prepaid expenses also fell to $11.3 million in the most recent period from $12.8 million in the same period last year. Among the largest items are insurance premiums, information systems contracts, licensure fees and deposits. Inventories were $13.1 million in the second quarter of 2024, up from $9.1 million in the same period last year. Deferred compensation funds rose to $1.2 million in the most recent period from $870,379 last year. Care New England’s deferred revenue fell to $9.7 million in the most recent quarter from $26.8 million last year. Accounts payable and accrued expenses were $173.4 million in the second quarter, marking a 13.8% increase over last year’s $152.4 million. Self-insurance trust funds rose to $197.1 million in the most recent quarter, a 20.1% increase over last year's $164.1 million. This reflects changes in net investment performance, contributions, dividends paid and settlements, management said. Care New England’s days cash on hand increased to 48 days in the second quarter from 43.7 days through the second quarter last year. Management said it is monitoring capital expenditures and has spent $25.3 million of the $64.6 million budget on items related to information technology, medical equipment, as well as facility upgrades and renovations. The health system continues to attribute its financial performance to management’s focus on different initiatives implemented during fiscal year 2023. Specifically, these include revenue cycle management; volume growth, including clinical service expansions both geographically and in terms of accessibility; improvements to the supply chain, including a recent arrangement with Captis Group Purchasing Organization/Aggregation Group; and implementing a lower corporate overhead structure. A spokesperson for Care New England was not immediately available Tuesday to comment on the financial report. Katie Castellani is a PBN staff writer. You may contact her at Castellani@PBN.com.