CLEVELAND, Ohio — The MetroHealth System made a dramatic financial turnaround last year, thanks largely to a laser focus on operating efficiencies and new revenue-generating efforts, as well as a recovery in financial markets.
The Cuyahoga County-owned hospital ended 2009 with an excess of revenues over expenses of $52.4 million, compared with a mere $641,000 in 2008, the system reported during its monthly trustee meeting Wednesday afternoon.
Last year’s excess included $6.1 million in investment interest and realized investment gains, and a $14.6 million net increase in the market value of investments. In 2008, the health system’s investments lost nearly $17 million in value.
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“The campaigns launched in 2008 have transformed MetroHealth into a more efficient operation; in 2010, we will build on those operational successes,” Mark Moran, the health system’s president and chief executive since March 2008, said in a written statement.
MetroHealth had revenues of $710.4 million last year, up 3 percent from $686.4 million in 2008. Operating income (which excludes investment income, and gains or losses on investments) was $31.7 million in 2009, compared with $8.7 million in the prior year.
The system provided $252.8 million in charity care in 2009, $12.6 million more than in 2008.
“This is an extraordinary year and an extraordinary turn, but we have to do better at sustaining our mission,” trustee Richard Hollington, an investment banker, said during the board’s meeting. “We have operated for a long time in deficits… that have not allowed us to reinvest in our facility. We must sustain a level of margin that allows us to reinvest in this institution.”
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This year, some of that reinvestment will be supported by MetroHealth’s recent issuance of $75 million in Build America bonds (pdf), which will be used to renew the Metro Life Flight fleet of emergency medical helicopters and to expand its community health network.
“Years of operating losses have constrained reinvestment in MetroHealth,” Moran said in the statement. “Our priority is to renew our facilities and expand services so that we can fulfill the growing needs of our patients.”
