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Ohio Health Market Review 2018

  • ID: 4614752
  • Report
  • August 2018
  • Region: United States
  • Allan Baumgarten
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Hospital Profitability in 2016 and 2017 was Strong in the Three Major Metropolitan Areas, and Increased by 31% in the Columbus Region

Ohio Health Market Review 2018 finds:

  • Ohio hospitals report strong profits, especially in the Columbus area
  • Health insurers gain enrollees, and Medicaid plans are strongly profitable

Cincinnati/Dayton/Columbus/Cleveland - Even though inpatient days declined in much of the state, Ohio hospitals continue to report strong profits, especially in the Columbus area. Ohio health plans enjoyed strong profits on their Medicaid plans in 2017, the largest line of business for HMOs.

These are some of the key findings in Ohio Health Market Review 2018, this 14th report analyzing healthcare insurance companies and provider systems in Ohio. Based on data on health plans and hospital systems in Ohio, the report describes key trends and analyzes their competitive strategies.

In the new report, the research finds:

  • Hospital profitability in 2016 and 2017 was strong in the three major metropolitan areas and increased by 31% in the Columbus region. Based on data from Medicare hospital cost reports, the hospitals in the Columbus area had combined 2017 net income of $1.477 billion, or 16.5% of their net patient revenues. That was 31% more than their combined net income of $1.126 billion in 2016. Nationwide Children’s had net income in 2017 of $578 million, or 38.1% of net patient revenues. The OhioHealth hospitals had net income of $493.4 million (15.6%) and the Ohio State University hospitals had net income of $280 million (9.1% of revenues). Hospitals in the Cincinnati/Northern Kentucky/Dayton region had combined net income of $908.4 million in 2016 (9.1% of net patient revenues), up from $768.7 million in 2015. Cincinnati Children’s, Christ and the Kettering Health Network hospitals reported the strongest net income.
  • In the Cleveland/Akron region, hospitals posted combined net income in 2016 of $982,5 million, or 7.3% of net patient revenues, down from $1.018 billion in 2015. The Cleveland Clinic hospitals had net income of $476 million (6.9% of revenues), while the University Hospitals system had net income of $366.4 million (11.3% of net patient revenues).
  • Inpatient days decreased again for hospitals in the Cincinnati and Cleveland areas but increased in the Columbus area. Inpatient days fell by 3.5% in 2016 in the Cincinnati region and by 2.7% for Cleveland/Akron area hospitals. Ohio hospitals continue to pursue growth strategies, including significant capital investments in new facilities, both inpatient and ambulatory centers, focusing on areas of population growth, where household income is above average and where many households have good employer group coverage. For example, travelers on Interstate 75 between Dayton and Cincinnati will see new hospitals and medical centers, including freestanding emergency departments, for each of the major systems.
  • Growth in Medicaid and individual enrollment has brought total membership for Ohio HMOs to over 3.2 million, the highest ever. HMO enrollment has grown every year since 2012 and surged in 2014 after Ohio expanded Medicaid eligibility and large numbers of individuals bought subsidized health plans. At the end of 2017, 2.46 million Medicaid recipients were in HMO plans compared to 1.7 million in 2013. Between 2013 and 2017, enrollment in HMO and PPO plans for individuals grew from 249,000 to 283,000.
  • After posting a combined net loss in 2016, Ohio HMOs reported 2017 net income of $316 million, or 1.6% of underwriting revenues. The state’s six Medicaid health plans posted combined underwriting income of $440 million in 2017 or 2.4% of revenues. Of the Medicaid HMOs, UnitedHealthcare Community Plan had the strongest margin in 2017 (5.0%), followed by Molina Healthcare (3.7%) and Buckeye Community (3.4%). CareSource, the largest health insurer in the state, mad $91.4 million on its Medicaid plans, but lost $73.7 million on its Medicare plans and $19.6 million on its individual plans.
  • In 2017, Anthem Blue Cross Blue Shield had an after-tax net income of $382.3 million, or 4.3% of revenues, compared to $319.1 million in 2015. Medical Mutual had net income of $22.4 million, less than in 2016.
Note: Product cover images may vary from those shown
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1. Introduction

2. Market Structure

  • Health Plans
  • Provider Systems

3. Trend Review

  • HMO Enrollment
  • Medicare Plans
  • Medicaid Managed Care
  • Net Income
  • HMO Financials by Line of Business
  • Provider Payments and Administrative Expenses
  • Health Plan Capital and Surplus
  • Hospital Systems and Regional Submarkets
  • Cincinnati-Northern Kentucky- Dayton
  • Cleveland-Akron
  • Columbus
  • Other Major Hospitals

4. A Look Ahead

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