The Richest Hospitals

There’s big money in health care

“Most hospitals lose money, but there are a few very profitable ones

and we need to pay attention to why they are making so much.”

— Gerard Anderson, (Johns Hopkins health policy professor)


No. 1

That’s Incredible!

The American Hospital Directory found that 24 hospitals in America with over 200 beds make a 25 percent or more profit margin. That profit margin is about the same as “Big Pharma,” an industry that is often criticized for its profits.

No. 2

Power Pricing

According to The Hill, in 2010 consumer prices finally dropped for the first time in 54 years. Despite this fact, the national health bill actually rose a little over 5 percent to $2.47 billion. This is due to the quiet provider consolidation that big hospitals are engaged in.

Princeton economist Alain Enthoven told Bloomberg that “provider consolidation is driving up health care costs. … We need effective antitrust enforcement, and we haven’t had that for some time.”

The Players

1. Flowers Hospital

Dothan, Alabama

235 beds

For-profit parent: Community Health Systems (Brentwood, Tennessee)

53 percent operating margin

$389 million

2. Del Sol Medical Center

El Paso, Texas

314 beds

For-profit parent: Hospital Corporation of America (Nashville, Tennessee)

45 percent operating margin

$243 million

3. Rochester Methodist Hospital

Rochester, Minnesota

336 beds

Nonprofit parent: Mayo Health (Rochester, Minnesota)

37 percent operating margin

$389 million

4. St. Luke’s Hospital

Cedar Rapids, Iowa

532 beds

Nonprofit parent: UnityPoint Health (formerly known as Iowa Health System), Des Moines, Iowa

36 percent operating margin

$389 million

5. Seton Medical Center

Austin, Texas

447 beds

Nonprofit parent: Ascension Health (St. Louis, Missouri)

34 percent operating margin

$389 million

6. Swedish Medical Center

Englewood, Colorado

367 beds

For-profit parent: HealthONE (Denver, Colorado)

33 percent operating margin

$447 million

7. Doctors Hospital of Augusta

Augusta, Georgia

287 beds

For-profit parent: Hospital Corporation of America (Nashville, Tennessee)

31 percent operating margin

$283 million

8. Ohio State University Hospital

Columbus, Ohio

1,009 beds

Nonprofit parent: University Medical Center (Columbus, Ohio)

32 percent operating margin

$1.98 billion

9. Saint Mark’s Hospital

Augusta, Georgia

317 beds

For-profit parent: Hospital Corporation of America (Nashville, Tennessee)

33 percent operating margin

$272 million

10. Northridge Hospital Medical Center

Northridge, California

424 beds

Nonprofit parent: Catholic Healthcare West (San Francisco, California)

30 percent operating margin

$458 million

Making America Healthy

According to Lisa Goldstein, head of health care bond ratings at Moody’s Investors Service, “A strategy aimed at quality (for-profit hospitals) can result in improved market share, better ability to recruit and retain physicians, lower nursing vacancy/turnover rates, and improved financial performance.”

And that’s just the way it is.

It’s true hospitals in the last 20 years have been discreetly consolidating to monopolize their local health care markets. This gives them the power to dictate prices at will.

Generally, almost all evolved countries have some form of socialized medicine and are generally more healthy than Americans.

Are they all wrong?