Providence reports Q3 2023 results

RENTON, Wash., November 29, 2023 – Providence, a not-for-profit health system serving the Western U.S., today announced results for the three months ended September 30, 2023. The report showed continued progress in operating performance driven by higher demand for patient services, improvements in retention and recruitment, lower premium pay and reduced length of stay.

“Health systems nationally continue to contend with significant macroeconomic pressures, including inflation, the shortage of health care personnel, and inadequate, delayed or denied reimbursement from payers. Yet, with a steadfast focus on our recovery and renewal strategies, we are seeing appreciable improvements in many of our local markets. Thank you to everyone at Providence for helping us stay the course on these strategies while continuing to deliver our Mission of compassionate, high-quality care for all,” said Providence CFO Greg Hoffman.

Some of Providence’s key strategies include a continued focus on retention and recruitment as the health system works to reduce overall reliance on costly agency staffing. Other steps include addressing discharge challenges related to staffing shortages in community-based post-acute facilities, as well as a continued focus on increasing surgical capacity to meet vital health care needs. Last year’s reduction in executive leadership roles, as well as efforts to renegotiate payment rates with commercial insurers have helped Providence shore up resources for patients and caregivers.

Providence experienced higher volumes in the third quarter, with case-mix adjusted admissions up 5.2% compared to the same period in the prior year. Net operating revenues were up 11% compared to prior year* driven by double digit growth in premium and diversified revenues. EBIDA was $104 million, the fifth consecutive quarter of positive results, and net operating losses were $310 million. In the third quarter, investment losses drove $71 million in non-operating losses. For the nine months ended September 30, 2023, EBIDA was $338 million, representing a $366 million improvement compared to prior year.

Remaining steadfast to the Mission, for the nine months ended September 30, 2023, the health system provided $1.5 billion in community benefit. This includes $1.1 billion in the unpaid costs of Medicaid for the nine months ended September 30, 2023, compared with $1 billion for the same period in 2022.  Providence’s total unrestricted cash and investments ended September at $8.2 billion.

“Though these are challenging times for health care across the country, our Mission is well positioned to endure and thrive for generations to come thanks to everyone at Providence. Together, we are making important strides and advancing the healing ministry, especially for those who are most vulnerable,” said Providence President and CEO Rod Hochman, M.D.

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About Providence

Providence is a national, not-for-profit Catholic health system comprising a diverse family of organizations and driven by a belief that health is a human right. With 51 hospitals, more than 1,000 physician clinics, senior services, supportive housing and many other health and educational services, the health system and its partners employ more than 121,000 caregivers serving communities across Alaska, California, Montana, New Mexico, Oregon, Texas, and Washington, with system offices in Renton, Wash., and Irvine, Calif. Learn about our vision of health for a better world at Providence.org.

_{* After normalizing for prior period provider tax in Q3 2022.}