The Hospital of the University of Pennsylvania Pavilion on Feb. 26, 2023.
Credit: Bamelak DukiFor the first time, the University of Pennsylvania Health System's annual revenue surpassed $10 billion in the 2024 fiscal year, according to The Philadelphia Inquirer.
The nonprofit system's total revenue figure for the fiscal year was $10.9 billion, a 9.3 percent increase from $9.97 billion in the 2023 fiscal year. UPHS reported $278 million in operating profit in the year that ended on June 30, a 17 percent increase from last year's $238 million.
The increase in revenue can be attributed in part to a lower average length of stay for inpatients in UPHS hospitals for the second year in a row, Chief Financial Officer Julia Puchtler told the Inquirer. She added that this was accomplished by an effort to move patients efficiently to the next stage of care, citing Penn Medicine creating a skilled nursing care at home pilot program.
According to the Philadelphia Inquirer, the cost of medical supplies and services has significantly increased compared to the revenue generated from patient care over the past year. Puchtler specifically pointed to a state Medicaid assessment and increases in chemotherapy drug expenses as reasoning for this, particularly citing Penn’s growing outpatient cancer program.
Other notable components of the Health System’s financial statements include a $129.2 million inflow from a federal drug settlement which “resolved cuts made to a national drug discount program designed to strengthen safety-net hospitals.”
The drug settlement was partially balanced out by a total of $90 million put away for future medical malpractice. Penn took an $80 million dollar charge at the beginning of the year to be added to the medical malpractice reserves and then added an additional $10 million to these reserves at the end of the fiscal year.
Earlier this year, Penn Medicine also lost an attempt to overturn a record $183 million medical malpractice settlement.
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