Las Vegas hospital industry still healing, not yet ready for discharge

Although robust by one measure, a thorough examination of the Las Vegas hospital industry’s financial health indicates that it is not ready for discharge, even after a lengthy convalescence.

Results for 2012 show a collective operating profit of $89.9 million, the best ever and the first in six years, according to reports the hospitals provide to the state’s Department of Health and Human Services.

This marked a sharp reversal from the $64.4 million the valley’s 13 acute care hospitals lost in 2011 and the $369 million in operating losses racked up in the five-year period of 2007-11.

Those years — and the combination of economic slump and expanded facilities — dispelled the long-standing nostrum that hospitals were recession-proof because people always get sick.

Much of the overall 2012 improvement — nearly 90 percent — stemmed from a $137.1 million year-to-year improvement at University Medical Center.

The public hospital took advantage of a new federal reimbursement program involving Medicaid and Medicare payments, according to CEO Brian Brannman, and part of the 2012 numbers it reported include a one-time bulge from retroactive payments for two prior years.

The improved hospital financial results, however, don’t mean the medical industry here has fully recovered.

“We are still in an economic recession compared to the period prior to 2007,” says Dr. Howard Baron, immediate past president of the Clark County Medical Society.

For example, the number of patients admitted to hospitals and the total number of days they occupied beds both declined last year. And eight of the 13 acute care hospitals in Las Vegas reported lower operating incomes than in 2011. Four posted losses.


A Las Vegas unemployment rate still slightly above 10 percent leaves many people here without medical insurance. And experts agree that many of them put off elective procedures because they cannot afford them.

In addition, says consultant Scott Weiss, people have even scrubbed checkups with primary care physicians, which can worsen health problems.

“They use the ER (emergency room) for primary care because they wait until they are so sick they have no choice,” says Weiss, an officer in the Southern Nevada Medical Industry Coalition.

So not only do they enter a hospital with little or no means to pay, they run up higher bills than would have been necessary with preventive care, he says.

Inpatient and outpatient bills written off as discounts for uninsured patients or bad debt and charity care hit $1.7 billion last year, a 42 percent rise since 2008. During the same span, revenues that the hospitals actually received rose only 12 percent to $3.1 billion.

These write-offs come on top of the deductions and discounts that hospitals routinely absorb from government programs and private insurers. The hospitals sent out bills for $18 billion at list prices — what people theoretically would pay without insurance — but collected just 17 percent of that.

On one hand, some in the industry point out, the overall results are depressed every year by an expense called “home office allocation,” by which an individual hospital sends money to support its parent corporation. This ran $154.2 million last year and has moved up and down in the recent past. Only county-owned UMC escapes this obligation, and nine of the other 12 hospitals belong to for-profit chains.

The industry’s financial performance, while largely unseen by the general public, can erode the quality of care over the long run, according to hospital observers. Brannman says much of the technology that forms the modern hospital’s backbone comes with big price tags, such as ultrasound machines at $50,000 to $90,000 each and CT scanners that top $1 million.

“To the extent we don’t have healthy (profit) margins, it makes it difficult to keep up with the technology and be able to provide the best quality of care,” he says.


Hospital chains have long contended that they can offset the financial pressures because they can raise critical financing more easily than stand-alone hospitals. In addition, diverse geography and practice strengths help steady lagging properties with the cash flow generated by stronger ones.

For example, HCA, which owns Sunrise, MountainView and Southern Hills, said in a prepared statement, “(W)e are encouraged by the performance of all our facilities in 2012. This level of performance allows us to reinvest in our facilities and our people.”

Both Sunrise and Southern Hills posted operating losses last year, while MountainView improved sharply and has undertaken a major expansion and renovation project.

Baron, however, notes it can work the other way: “Maybe the mother ship is not going to be so generous with a hospital that is losing money.”

He adds that side effects have already shown up in the form of tighter staffing.

“Nurses are being called on to do more and more with less and less,” he says. “You see people scurrying around to keep up with their duties.”

At some hospitals, for example, people assigned to answer phones and monitor the desk at a nursing station have dis­appeared, so it may take many rings before someone picks up.

According to the state reports, three of the five hospitals owned by Universal Health Services finished 2012 with smaller staffs than a year earlier. The category is measured by full-time equivalent positions, and includes nurses, aides, orderlies and a range of other job descriptions.

The entire county finished the year with 39 fewer positions, including 23 nurses, out of 15,325 total full-time equivalent positions.


Financial results for individual hospitals include some repeats of recent years. Both Southern Hills and the St. Rose Dominican Hospital’s San Martin campus posted losses, although Southern Hills moved closer to the break-even point.

Within sight of each other in the southwest corner of the valley, they were planned more than a decade ago when real estate developers projected that area would boom for years. Both hospitals, however, were left surrounded by too much desert when the housing market cratered five years ago.

The St. Rose-de Lima campus, located in a section of Henderson with high Medicaid and uninsured populations, also continued to lose money.

Sunrise Hospital and Medical Center, also with a high Medicaid and uninsured patient load, showed a loss after a profit in 2011.

MountainView, in the northwest valley, more than doubled its profit as it stepped up an emphasis on specialties that serve senior citizens in nearby sections of Summerlin. The hospital is now in the process of finishing a $70 million expansion and renovation project, including a revamped emergency room, new intensive care beds and more general beds.

St. Rose-Siena, Summerlin and Spring Valley hospitals remained in the top ranks of the financial performers, making profits in 2012.

Overall, Baron says, the competition to draw patients and boost financial results has heightened around the valley:

“You see it when you drive down 215 with all those billboards advertising ER wait times.”

Contact reporter Tim O’Reiley at or 702-387-5290.

Lehman Brothers bet big on Las Vegas
Lehman Brothers collapsed 10 years ago, helping send the country into the Great Recession.
Fremont9 opens downtown
Fremont9 apartment complex has opened in downtown Las Vegas. (Marcus Villagran/Las Vegas Review-Journal) @marcusvillagran
Ross & Snow launches in Las Vegas
Luxury shoe brand Ross & Snow has opened in Las Vegas, featuring "functional luxury" with premium shearling footwear. (Bailey Schulz/Las Vegas Review-Journal)
Remote Identification and Drones
DJI vice president of policy and public affairs discusses using remote identification on drones. (Bailey Schulz/Las Vegas Review-Journal)
Drones and public safety in Nevada
Two representatives in the drone industry discuss UAV's impact on public safety. (Bailey Schulz/Las Vegas Review-Journal)
Frontier Airlines to launch flights from Las Vegas to Mexico
Frontier, a Denver-based ultra-low-cost carrier, will become the first airline in more than a decade to offer international service to Canada and Mexico from Las Vegas when flights to Cancun and Los Cabos begin Dec. 15. (Rick Velotta/Las Vegas Review-Journal)
MGM Resorts International CEO Jim Murren addresses Oct. 1 lawsuits
MGM Resorts International Chairman and CEO Jim Murren addresses criticism his company has received for filing a lawsuit against the survivors of the Oct. 1 shooting. (K.M. Cannon/Las Vegas Review-Journal)
MGM Resorts International opens the doors on MGM Springfield
Massachusetts’ first hotel-casino opens in downtown Springfield. The $960 million MGM Springfield has 252 rooms and 125,000-square-feet of casino. (K.M. Cannon/Las Vegas Review-Journal)
MGM Resorts International prepares to open MGM Springfield
Las Vegas-based MGM Resorts International gave news media and invited guests a preview of the $960 million MGM Springfield casino in Massachusetts. The commonwealth's first resort casino will open Friday, Aug. 24. (K.M. Cannon/Las Vegas Review-Journal)
A Walk Through Circus Circus
It only takes a short walk through Circus Circus to realize it attracts a demographic like no other casino on the Strip: families with young children. (Todd Prince/Las Vegas Review-Journal)
Morphy Auctions, a vintage slot machines seller, wants gaming license
Vice president Don Grimmer talks about Morphy Auctions at the company's warehouse located at 4520 Arville Street in Las Vegas on Thursday, Aug. 16, 2018. (Rick Velotta/Las Vegas Review-Journal)
Nevada's venture capital money doesn't stay in state
Zach Miles, associate vice president for economic development for UNLV, said there’s venture money in Southern Nevada, “but trying to find the right groups to tap into for that money is different.” According to a 2017 report from the Kauffman Foundation, Las Vegas ranked number 34 out of 40 metropolitan areas for growth entrepreneurship, a metric of how much startups grow. With a lack of growing startups in Las Vegas, investment money is being sent outside of state borders. The southwest region of the U.S. received $386 million in funding in the second quarter, with about $25.2 million in Nevada. The San Francisco area alone received about $5.6 billion. (source: CB Insights)
Neon wraps can light up the night for advertising
Vinyl wrap company 5150 Wraps talks about neon wraps, a new technology that the company believes can boost advertising at night. (Marcus Villagran/Las Vegas Review-Journal) @brokejournalist
Nevada on the forefront of drone safety
Dr. Chris Walach, senior director of Nevada Institute for Autonomous Systems, talks to a reporter at NIAS's new Nevada Drone Center for Excellence of Public Safety, located inside the Switch Innevation Center in Las Vegas. K.M. Cannon Las Vegas Review-Journal @KMCannonPhoto
Motel 8 on south Strip will become site of hotel-casino
Israeli hoteliers Asher Gabay and Benny Zerah bought Motel 8 on the south Strip for $7.4 million, records show. They plan to bulldoze the property and build a hotel-casino. Motel 8 was built in the 1960s and used to be one of several roadside inns on what's now the south Strip. But it looks out of place today, dwarfed by the towering Mandalay Bay right across the street.
Project billed as one of the world's largest marijuana dispensaries plans to open Nov. 1
Planet 13 co-CEO Larry Scheffler talks about what to expect from the new marijuana dispensary, Thursday, July 19, 2018. (Marcus Villagran/Las Vegas Review-Journal) @brokejournalist
Oasis Biotech opens in Las Vegas
Brock Leach, chief operating officer of Oasis Biotech, discusses the new plant factory at its grand opening on July 18. (Bailey Schulz/Las Vegas Review-Journal)
UNLV Tech Park innovation building breaks ground
Construction on the first innovation building at the UNLV Tech Park is underway. (Bailey Schulz/Las Vegas Review-Journal)
Caesars Forum Meeting Center
Caesars broke ground Monday on its $375 million Caesars Forum Meeting Center (convention center) just east of the High Roller observation wheel. (Caesars Entertainment)
Technology reshapes the pawn shop industry
Devin Battersby attaches a black-colored device to the back of her iPhone and snaps several of the inside and outside of a Louis Vuitton wallet. The device, installed with artificial intelligence capabilities, analyzes the images using a patented microscopic technology. Within a few minutes, Battersby receives an answer on her app. The designer item is authentic.
Recreational marijuana has been legal in Nevada for one year
Exhale Nevada CEO Pete Findley talks about the one year anniversary of the legalization of recreational marijuana in Nevada. (K.M. Cannon/Las Vegas Review-Journal)
Young adults aren't saving for retirement
Financial advisors talk about saving trends among young adults. (Bailey Schulz/Las Vegas Review-Journal)
Celebrity photographer dedicates dance book to Las Vegas shooting victims
Behind the scenes with local celebrity photographer Jerry Metellus as he talks about his Dance For Vegas coffee book dedicated to the 58 victims of the October 1 shooting. (Marcus Villagran/Las Vegas Review-Journal) @marcusvillagran
Dreamsickle Kids Foundation founder Gina Glass talks awareness
Gina Glass, 35, founded Dreamsickle Kids Foundation to raise awareness for sickle cell disease in Nevada. (Jessie Bekker/Las Vegas Review-Journal)
The Meadows School founding kindergarten teacher retires after 34 years at the school
Linda Verbon, founder of the The Meadows School's kindergarten program and the first faculty member hired at the school, retired in the spring after 34 years at The Meadows. (K.M. Cannon/Las Vegas Review-Journal)
Kids become firefighters at Fire Station 98 open house
Henderson residents wore fire hats, learned about CPR and met firefighters at the Fire Station 98 open house Saturday, August 11, 2018. (Marcus Villagran Las Vegas Review-Journal) @brokejournalist
People from all over the world attend RollerCon 2018
RollerCon 2018 is a five-day convention focused on the roller derby community and culture at Westgate in Las Vegas. (Marcus Villagran/Las Vegas Review-Journal) @brokejournalist
Camp Broadway teaches kids how to sing and dance
The Smith Center's seventh annual Camp Broadway musical theater program gives 150 kids ages 6-17 an opportunity to learn musical theater skills from industry professionals over a five-day period. Marcus Villagran/ Las Vegas Review-Journal @brokejournalist
Las Vegas police officer on being PETA's Sexiest Vegan Next Door
Las Vegas police officer David Anthony talks vegan lifestyle and how he feels about being voted PETA's sexiest Vegan next door from his home on Monday, July 9, 2018. (Marcus Villagran/Las Vegas Review-Journal) @brokejournalist
'NO H8' Campaign comes to Las Vegas
Hundreds of locals participate in the NO H8 campaign founded by Adam Bouska and Jeff Parshley as a response to Proposition 8, a California ban on same-sex marriage. The campaign has since evolved to represent equal treatment for all. (Marcus Villagran/Las Vegas Review-Journal) @brokejournalist
Over 40,000 People Attend The 4th Of July Parade In Summerlin In Las Vegas
Over 40,000 People Attend The 4th Of July Parade In Summerlin In Las Vegas. (Janna Karel Las Vegas Review-Journal)
Star Wars and Golden Knights mashup at downtown art shop
Star Wars and Vegas Golden Knights fans attend the Boba Fett Golden Knight Paint Class at The Bubblegum Gallery in Las Vegas, Friday, June 29, 2018. (Marcus Villagran/Las Vegas Review-Journal) @brokejournalist
News Headlines
Add Event
Home Front Page Footer Listing
You May Like

You May Like