Hospitals report healthy profits

Monday, April 21, 1997 | 11:59 a.m.

CARSON CITY -- Major hospitals in Las Vegas and Reno recorded big profits in 1996 but those in rural Nevada continued to struggle financially, according to a new state report.

It shows Columbia Sunrise Hospital and Medical Center in Las Vegas chalked up $25 million in net operating revenue, the highest in the state. Lake Mead Hospital Medical Center in North Las Vegas led the way in profits per day, per patient at $263.

Nye Regional Medical Center in Tonopah had the dubious honor of losing the most money in 1996 -- $2.6 million, or $931 per patient per day.

Under a 1991 agreement with Gov. Bob Miller, the five major private hospitals in Las Vegas and Reno are permitted to increase rates each year only by the medical cost-of-living index.

The law is due to expire this year, but Christopher Thompson, chief of the state's Health Care Financial Analysis Unit, said a bill is being prepared to continue the limits on hospital price increases. "I'm not aware of any significant opposition," Thompson said.

The unit is expected to tell hospitals next month the maximum they will be able to raise their rates for the next fiscal year.

The major hospitals in Las Vegas and Reno, according to the report, collected an average of $1,444 per patient per day, up 8 percent from 1995.

While Columbia Sunrise posted the biggest profits, its sister, Columbia Sunrise Mountain View Hospital, in northwest Las Vegas, recorded a $1.9 million loss in its first year of operation. Thompson said it is the "general case" that hospitals lose money at first but gradually come into the black.

He said for the first quarter of operation, Mountain View's patient load was 20 percent of capacity and that rose to 58.7 percent as the year went by. He said he expected they were at the "break-even point" in the final quarter of the year.

It was reported earlier this month that Columbia hospitals in Nevada, Florida, Texas, Illinois and Kentucky are under investigation by the federal Health Care Financing Administration for a practice called "upcoding," in which the hospital inflates the seriousness of the illness to collect higher payments from Medicare. A spokeswoman for Columbia Sunrise in Las Vegas said there was no investigation so far at the Southern Nevada hospital.

For its capacity, Thompson said Lake Mead Hospital was "far and away the most profitable." It has kept its expenses down and it operates a psychiatric unit at a low cost, he said.

He said there's been a "tremendous turnaround" at Lake Mead, which previously had suffered some troubled years.

The "Big Six" hospitals, which include the four major ones in Las Vegas and the two in Reno, registered $60 million in profits in 1996, down from $70.6 million a year ago.

University Medical Center in Las Vegas, which lost $7.5 million in 1995, ended up with a $590,439 profit at the end of 1996, according to the report.

Washoe Medical Center in Reno posted $4.2 million in profits in 1996, down from $18 million in 1995. Thompson said Washoe Medical "got a little embarrassed" by its large profits in 1995 and started some new health programs that are costing more money.

The 10 hospitals in rural counties accumulated a loss of $4.3 million compared with a $1.7 million loss in 1995. The loss in rural counties, Thompson said, "is to be expected."

"They don't have the operations to get to the break-even point without that money," he said, referring to county subsidies. Elko General and Churchill Community were the only two rural hospitals to make money in 1996 -- $1.1 million and $2.1 million respectively.