Hospital Profits Slumped, Charges Held Steady
December 17, 2009 -- Despite a financial slump last year, Oregon's 57 hospitals still managed to amass more than $240 million in profit, their worst performance in five years, according to audited financial records filed with the Oregon Office of Health Policy and Research.
With higher uncompensated care costs and a down economy Oregon hospitals earned more than 50 percent less profit than in 2007, while collecting more than 8 percent greater revenue, which meant everyone -- including insurers -- paid more for their services.
All told, hospitals brought in more than $7 billion in revenue during 2008, compared to less than $6.5 billion the year prior. In fact, their revenues have increased each year since 2002 by 8 percent, which indicates that cost containment hasn't made an impact on hospitals during these difficult economic times as they keep raising their rates.
Oregon has some of the most efficient hospitals in the country, evidenced by their low Medicare reimbursement rates, but overall hospital costs in the state are still a leading driver each year of double-digit insurance rate increases.
A look at hospital payments in Oregon show wide discrepencies. In cities that have only one hospital such as Bend, the variations are even more dramatic because these hospitals have no competition and can demand higher reimbursement rates, which inevitably drive up everyone's insurance costs.