Lifespan grows operating income 23% in FY18

PROVIDENCE – Lifespan Corp.’s income from operations grew 22.7 percent to $17.9 million in fiscal 2018, as the hospital group weathered a four-day strike that increased expenses when fill-in workers were hired for the duration.

Overall Lifespan saw a 6.4 percent increase in total unrestricted revenue and other support to $2.3 billion from the previous year. Patient service revenue increased 5.9 percent to $2.1 billion.

The health care provider group experienced a $270,000 operating loss in the fourth quarter, ended Sept. 30, reversing an operating gain of $191,000 in the fourth quarter of fiscal 2017, despite seeing a 6.4 percent increase in unrestricted revenue and other support to $557.7 million. The four-day strike at Rhode Island Hospital by the United Nurses and Allied Professionals between July 23 and Sept. 30 was at least partly responsible for the quarterly shortfall.

Patient service revenue increased 4.8 percent to $529.1 million in the fourth quarter, compared with the same period in 2017. Total unrestricted revenue in the period grew 6.4 percent to $577.7 million.

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For the full year Lifespan saw its net asset position improve by $117.2 million, although that was a 7.6 percent decline from the net asset increase in fiscal 2017. The change in net assets is a measure of not only operating income but changes in the value of investments as well as gifts, grants and bequests.

Charity care, which is health care provided in full or part for those who cannot afford to pay for it, totaled $92.8 million in fiscal 2018, $300,000 less than in fiscal 2017, while the provision for bad debt for the 12 months was $60.9 million, a decline of $7.6 million. All told, uncompensated care (charity care and bad debt) amounted to 2.6 percent of gross patient service revenue in fiscal 2018, an improvement of the 2.9 percent portion in fiscal 2017.

Lifespan’s long-term debt fell 7.4 percent over the year to $310.2 million as the company made payments on its debt.

Lifespan broke out results for its “Obligated Group,” comprised of Rhode Island/Hasbro Children’s Hospital, The Miriam Hospital, Emma Pendleton Bradley Hospital, the Rhode Island Hospital Foundation and The Miriam Hospital Foundation. Total unrestricted revenue and other support increased 6.6 percent to $2 billion in fiscal 2018, producing operating income of $21.9 million, a year-over-year decline of 3.7 percent.

Rob Borkowski is a PBN staff writer. He can be reached at Borkowski@PBN.com.