Maimonides Medical Center suffered $84 million in operating losses last year, continuing long-standing financial struggles that have jeopardized the hospital’s path to sustainability, financial documents show.
The Borough Park health system was in the red by 5% in 2023 because of continued operating pressures and high expenses, according to its annual financial statement released Monday. The yearly performance follows months of low margins in the last year that dipped as low as 12% in the third quarter.
Maimonides collected $1.8 billion in operating revenue in 2023, $1.5 billion of which came from patient services revenue. But the health system incurred $1.9 billion in operating expenses, primarily driven by wage costs and a 14% increase in employee benefit payments.
The medical center’s operating performance, assets and future cash flow all “raise substantial doubt” about the hospital’s ability to continue operating as usual within the next year, management said in financial documents. Administrators said that the hospital has implemented cost cutting measures and received funding from the state Department of Health to help it stay financially viable.
Sam Miller, a spokesman for Maimonides, said that the hospital received $72 million in state aid in 2023. Some improvements in the fourth quarter and funding from Gov. Kathy Hochul has enabled the hospital to provide high-quality care and improve services, Miller said, such as the completion of Brooklyn’s only pediatric emergency department and the expansion of its emergency department over the next year and a half.
Although administrators expressed concerns about Maimonides’ future, Miller said that future state aid is likely though not guaranteed.
Maimonides has struggled to stay afloat in recent years, a situation that has only worsened since the Covid-19 pandemic. The health system has sought out ways to save money, most recently in a largely criticized attempt to evict current and former hospital workers from buildings it used to own and sold to mitigate financial stress.
But the medical center may have an out if its finances continue to suffer. Maimonides entered a strategic partnership with Northwell Health in 2015, which offered it a two-year, $125 million unsecured loan to improve its clinical outcomes and finances. The ultimate goal of the agreement is for Northwell to buy Maimonides, which is planned to become the Brooklyn hub of Northwell Health. In 2022 Maimonides extended its partnership with Northwell through June 2024.
Maimonides has three hospitals and more than 80 outpatient and community-based health centers in Brooklyn.
Amanda D'Ambrosio , 2024-05-15 11:33:04
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