Sutter Health Reports $465 Million in Operations, Investment Income for 2003
Sacramento-based not-for-profit Sutter Health on Friday announced income from operations and investments of $465 million for 2003, compared with $284 million for 2002, "fueling claims that it charges too much for its services," the San Francisco Chronicle reports. Sutter, which includes nine physician organizations and 26 hospitals in Northern California, posted $5.7 billion in revenue for 2003, compared with $4.9 billion in 2002. In addition, Sutter reported an operating margin of 7% for 2003; not-for-profit hospitals had a median operating margin of 1.5% in 2002, according to Fitch Ratings. Sutter officials said that the company requires higher income to finance the cost of improvements throughout the health system, such as a $1.2 billion project to upgrade information technology and a $5.7 billion project to rebuild, replace and expand some hospitals. However, CalPERS maintains that the "strong margins" posted by Sutter "reflect costs that are too high," the Chronicle reports. CalPERS officials will meet May 11 to consider plans to eliminate coverage for members at some Sutter hospitals or require Sutter to cap annual price increases (Colliver, San Francisco Chronicle, 5/1).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.