Home Butler Hospital Care New England reports $2.7M gain in Q3

Care New England reports $2.7M gain in Q3

By

Katie Castellani

-

08/22/2024

Kent Hospital — CARE NEW ENGLAND Health System posted a $2.7 million operating gain in the third quarter of 2024, according to unaudited financial reports released Aug. 14. Pictured is Kent County Memorial Hospital, which is operated by Care New England. / COURTESY KENT COUNTY MEMORIAL HOSPITAL

PROVIDENCE – Care New England Health System posted a $2.7 million operating gain in the third quarter of 2024, according to unaudited financial reports released Aug. 14. The earnings mark the fifth consecutive quarter in the black for the state’s second-largest health system and come after Care New England reported a $1.9 million operating gain

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PROVIDENCE – Care New England Health System posted a $2.7 million operating gain in the third quarter of 2024, according to unaudited financial reports released Aug. 14. The earnings mark the fifth consecutive quarter in the black for the state’s second-largest health system and come after Care New England reported a $1.9 million operating gain in the previous quarter. However, the results also mark a slight decrease compared with the same period last year when Care New England reported an almost $2.9 million operating gain. Net income for the quarter was $3.96 million, down from last year’s $9.2 million. Operating revenues ticked up to $359.7 million while expenses rose to $356.96 million over the $336.1 million in operating revenue and $333.2 million in operating expenses reported in the same period last year. Driving the increase in revenue was net assets released from restrictions, which grew to $2.9 million from $422,746 last year in the third quarter. Care New England’s net patient service revenue rose to $300.5 million from $275.7 million in the same quarter last year. At the same time, the health system saw its grant revenue relief funds drop by 57% to $472,306 from $1.1 million a year ago. Licensure fees continued to affect expenses, growing to $17.1 million in the first three quarters of 2024 from $10.2 million last year. Purchased services have continued to rise, reaching $38.8 million in the third quarter of 2024, up from last year’s $28.1 million and the previous quarter’s $36.5 million. Medical supplies and drugs rose to $41.7 million compared with last year’s $36.7 million and last quarter’s $40.9 million. Salaries and Wages rose to $153.98 million in the most recent quarter from $148.5 million in the same period last year, but they fell from last quarter's $154.1 million. Insurance expenses dropped by 26% year over year in the third quarter to $9.4 million, down from $12.7 million a year ago and $10 million last quarter. Total assets for the quarter were $1.06 billion, a 9.32% increase over last year’s $971.7 million. Boosting assets were cash and cash equivalents, which rose to $55.1 million from last year’s $30 million. Inventories increased to $13.6 million, which is 45% higher than last year’s $9.3 million. Other receivables stayed relatively unchanged in the most recent quarter, dropping slightly to $44.3 million from $44.5 million a year ago but saw a larger decrease from last quarter's $77.7 million. Care New England attributed this to the timing of receipts from the Rhode Island Medicaid License Fee program because disbursements tend to come before the receipt of funds. Prepaid expenses rose by $2.3 million to $19.4 million in the most recent quarter compared with $17.1 million in the same period last year. Care New England said this was largely because of insurance premiums, information systems contracts, as well as licensure fees and deposits. Accounts payable and accrued expenses increased by $46.1 million to $178.7 million in the most recent quarter from $132.6 million last year. The health system said this was related to the timing of the state's licensure fee. Deferred revenue fell to $4.9 million from $17.1 million last year. Net assets without donor restrictions increased to $211.4 million in the most recent quarter from $151.2 million last year. Care New England noted this includes favorable returns on the health system’s unrestricted investments. Net assets with donor restrictions rose to $121.8 million, up from $111.7 million last year, part of which comes from returns on Care New England’s restricted investments. The health system’s days cash on hand increased to 49.5 days in the most recent period compared with 45.8 days reported the same time last year. Also, Care New England has spent $42.1 million of its $64.6 million capital budget mainly on items related to information technology, and facilities upgrades and renovations. Care New England opened its 25-bed Short Stay Unit at Butler Hospital in June, which is meant to provide mental health services and help reduce overcrowding in emergency rooms. Also, Women & Infants Hospital is renovating its labor and delivery rooms through a project to build a new labor and delivery complex on its campus. The health system expects the complex to open in May 2025 and 95% of the construction costs were raised through philanthropy. The health system’s management again attributed the financial performance to initiatives started last fiscal year, including revenue growth and management through reducing denials, prior authorizations, as well as growing volume through expanding clinical services. Care New England has also prioritized improving its supply chain through a group purchasing agreement and using a lower corporate overhead structure. A spokesperson for Care New England was not immediately available Thursday to comment on the financial report. Katie Castellani is a PBN staff writer. You may contact her at Castellani@PBN.com.