More patients, the acquisition of two new hospitals and increased revenue from its health-insurance subsidiary helped the North Shore-LIJ Health System record a strong fiscal performance over the first half of 2015.
An earnings report issued this week by the Great Neck-based health system notes an operating income of $52.7 million for the six months ending June 30, up from $38.1 million over the first half of 2014.
The system’s “Discussion and Analysis of Financial Performance” reports a 25 percent year-over-year increase in total operating revenue through June 30, to roughly $4.2 billion, and total operating expenses of about $4.15 billion.
The substantial revenue jump included increases in net patient-service revenues (up $406.3 million) and physician-practice revenues (up $76.3 million), according to the report.
Among other healthy year-over-year numbers reported by North Shore-LIJ: Through June 30, the health system recorded 13,000 additional ambulatory surgery visits, 42,000 additional treated-and-released emergency room visits and 29,000 additional health-center visits.
While more patients were treated and income and revenue both increased, many health system expenses also increased sharply, due primarily to Q4 2014 acquisitions of Phelps Memorial Hospital, a 238-bed facility in Sleepy Hollow, and Northern Westchester Hospital, a 233-bed facility in Mount Kisco.
North Shore-LIJ’s $4.15 billion in operating expenses through June 30 represented a year-over-year increase of 16.5 percent. Health system salaries and employee benefits increased 14.7 percent to $2.66 billion, while the system also reported increases in supply costs (up nearly 21 percent) and depreciation/amortization (up 16.2 percent), all due largely to the acquisitions.
Health system officials also linked the increases to “strategic initiatives related to changes in healthcare delivery and payment models,” including investments in staff support programs, IT expansions and “various safety, quality and patient-experience initiatives,” according to the earnings report.
While helping to hike expenses, the new acquisitions also helped North Shore-LIJ post those income and operating-revenue increases, setting an overall positive tone for the 19-hospital system’s first-half finances.
Contributing mightily to that positivity was CareConnect, the system’s indigenous health plan. CareConnect now boasts over 26,000 members, up from only 10,000 last summer. Through June 30, year-over-year premium revenues increased 205.3 percent to $95.3 million, according to the earnings report.
North Shore-LIJ is the only private health system offering an independent plan on the New York State health insurance exchange.