Michigan Medicine reports strong financial results, growth

Topics:

Michigan Medicine reported positive fiscal year-end results Thursday, with an anticipated 5.6 percent — or $210 million — operating margin on budgeted operating revenues of $3.7 billion for the University of Michigan Health System.

Michigan Medicine’s UMHS includes three hospitals, 125 clinics and the U-M Medical Group.

David Spahlinger, president of UMHS and executive vice dean for clinical affairs of the Medical School, presented the positive projection of year-end results for fiscal year 2017 along with the FY ’18 budget to the Board of Regents.

Michigan Medicine also saw strong patient volume in both clinics and hospitals, coupled with improved patient access and quality outcomes, all of which contributed to the projected operating margin, Spahlinger says.

“Our projected fiscal year 2017 results and the plan for fiscal year 2018 reflect our focus on improving quality and safety and reducing the cost of care,” he says.

“But it’s the expertise and teamwork of our fantastic, dedicated faculty and staff that makes the difference. Our performance depends on the contributions of all of those who provide care for our patients across Michigan Medicine, including nurses, physical therapists, social workers, support staff and many more.”

Spahlinger cited projects that improved patient access in FY ’17, including the addition of four incremental operating rooms in University Hospital, six new patient rooms in the C.S. Mott Children’s Hospital newborn intensive care unit, five new inpatient rooms in University Hospital and moving the Department of Psychiatry into University Hospital South.

Also Thursday, regents approved a budget that sets Michigan Medicine financial performance targets for the fiscal year that begins July 1. The FY ’18 plan aims for a 5.4 percent operating margin on revenues of $3.8 billion.

“These targets are aggressive but needed to fund our aspirations for the next five years and beyond,” Spahlinger says. “We are challenging ourselves to reach those goals and give us the ability to invest in our future.”

Michigan Medicine has embarked on additional projects to increase patient access, including a new health center in west Ann Arbor set to open this fall and the Brighton Center for Specialty Care set to open in 2018.

Spahlinger also reported on separate financial performance for U-M Health, which represents Michigan Medicine affiliations. In FY ’17, U-M Health is anticipated to have an operating margin of 0.2 percent on $377 million.

For FY ’18, operating revenues of $413 million are expected to generate an operating margin of minus 0.3 percent. That negative margin reflects investments planned for the long-term financial health of U-M Health.

Tags:

Leave a comment

Commenting is closed for this article. Please read our comment guidelines for more information.