Mass General Brigham Reports First Quarter 2022 Financial Results – Mass General Brigham

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Mass General Brigham is navigating the unique challenges posed by the COVID-19 pandemic and the acute capacity and staffing crisis, while continuing to make substantial progress on its strategy to build the integrated academic health system of the future with patients at the center. The system’s strategy is focused on building more affordable models of care for our patients closer to home, while at the same time delivering an exceptional patient experience and accelerating innovation through research and education to make breakthrough treatments more widespread and more accessible for patients.

“We are continuing to address long-standing capacity challenges for our patients, severely exacerbated by deferred care and a staffing crisis during the latest COVID-19 surge,” said Anne Klibanski, MD, President and CEO of Mass General Brigham. “The hard work and commitment of our dedicated staff never wavered– they continued to provide the very best patient care we are known for despite these immense challenges.”

“It is essential that we recognize and act on what has been highlighted by the pandemic – the urgent need for long-term, equitable, sustainable solutions to expand access to care, providing more care to our patients in lower cost settings, closer to and inside their homes empowered by digital health innovation,” Klibanski continued.

Mass General Brigham reported income from operations of $10 million (0.2% operating margin) in the first quarter of 2022, which ended on December 31, 2021. This includes income from provider activity of $16 million (0.4% operating margin) and a loss from insurance activity of $6 million (-2.5% operating margin). 

The system generated total operating revenue of $4.1 billion in the first quarter of 2022. Patient care revenue grew to $3.0 billion, an increase of $240 million (9%) over the 2021 first quarter, reflecting increases in inpatient acuity and overall utilization of services at Mass General Brigham’s academic and community sites, facilitated by systemwide efforts to coordinate capacity management. Operating expenses totaled $4.1 billion, an increase of $402 million (11%) over the 2021 first quarter and remain elevated due to increases in wages (10%, including increased use and cost of temporary staffing), employee benefits (13%) and costs and use of clinical supplies (15%).

“Balancing the intense demand for patient care services with a critical staffing and bed shortage has been our primary focus during late fall and early winter,” said Niyum Gandhi, Chief Financial Officer and Treasurer at Mass General Brigham. “Throughout this crisis, our new systemwide capacity management structure allowed Mass General Brigham to coordinate capacity needs across hospitals and reduce surgical and procedural cases as needed, often exceeding the state-imposed restrictions. These necessary shifts in the provision of care, along with ongoing labor and supply cost pressures, will impact our short-term operating performance, but we remain committed to investments in home and ambulatory care services to improve patient access and affordability over the long-term.” 

For the three months ended December 31, 2021, the system absorbed $495 million in Medicare, Medicaid, and Health Safety Net shortfalls due to certain government reimbursements that do not cover the full cost of providing care to Medicare, low-income, and uninsured patients, an increase of $74 million (18%) compared to the shortfall absorbed in the comparable prior year period. 

In the first quarter of fiscal year 2021, the system reported income from operations of $130 million. This includes $30 million in Affordable Care Act risk corridor program subsidies for coverage provided in 2014-2016. Excluding the subsidies, the system generated operating income of $100 million (2.6% operating margin), including income of $114 million (3.1% operating margin) from provider activity and a loss of $14 million (-6.1% operating margin) from insurance activity.

Optimizing Emergency, Pathology Services
Building upon the successful implementation of a single enterprise radiology service designed to deliver a consistently exceptional imaging experience for patients across all Mass General Brigham locations, the system has now also established enterprise emergency medicine and pathology services.

The enterprise emergency medicine service, launched in January, will advance patient experience, quality and safety, health equity and information technology optimization. These and other benefits will create efficiencies that promote accountability for patient outcomes, supporting our vision of being an integrated health care system with the patient at the center. 

In March, the system plans to launch its enterprise pathology service to streamline patient care and diagnostic protocols across all locations. Collaboration among hospital pathology departments across the system will enable Mass General Brigham to provide the highest-quality and most cutting-edge clinical laboratory testing and pathology services for all its patients and aligns with the goals of providing cost efficient and seamless integrated care.

Advancing Patient Access and Care Through Digital Health 
Mass General Brigham is transforming the patient care continuum by advancing digital health solutions to better coordinate medical care with patients and their families. By expanding the capabilities of the Patient Gateway portal, now available to patients in six languages, patients will be better able to manage all health care matters whether clinical, administrative, or financial. Additionally, Mass General Brigham Digital is expanding technology solutions beyond telemedicine and care in the home to include programs like remote patient monitoring with frequent data collection, protocol-based treatment algorithms, and navigators to support patients in their ongoing health management.   

Enhanced Community and Mental Health Funding 
During the first quarter of fiscal year 2022 Mass General Brigham added to its $175M annual investment in community health by announcing an additional $50 million to fund new, comprehensive community and mental health strategies.  Distribution of that funding is now underway and several additional partnerships have just been announced. These include a $500,000 grant to the Food Bank of Western Massachusetts and a strategic five-year mental health agreement with the New Commonwealth Racial Equity and Social Justice Fund. This partnership will invest $2.5 million to advance maternal health equity and support practitioners and advocates to make critical advances in patient care and outcomes and improve health equity of Black and Brown communities across the Commonwealth.

Nonoperating activity
An overall gain of $105 million was reported in the first quarter of 2022, including a nonoperating gain of $95 million. Nonoperating activity includes gains and losses on investments and interest rate swaps, which can vary significantly year to year due to volatility in the financial markets, and philanthropic activity. In the comparable 2021 period, the system reported an overall gain of $1.1 billion, including a nonoperating gain of $941 million.

Forward-Looking Statements
This press release contains certain “forward-looking statements” concerning financial and operating plans and results which involve known and unknown risks and uncertainties. In particular, statements preceded or followed by, or that include the words, “projects,” “believes,” “expects,” “estimates,” “anticipates,” “plans,” “intends,” “scheduled,” or similar expressions are forward-looking statements. Various factors could cause Mass General Brigham’ actual results to differ materially including, but not limited to the impact of the COVID-19 pandemic, federal and state regulation of healthcare providers, changes in reimbursement policies of state and federal government and managed care organizations, competition in the healthcare industry in our market, general economic and capital market conditions, and changes in our labor and supply costs and in our ability to retain personnel. For more information on these and other risk factors, please refer to our most recent bond official statement or annual disclosure statement filed on the Electronic Municipal Market Access (EMMA) website maintained by the Municipal Securities Rulemaking Board. We undertake no responsibility to update any such forward-looking statements except as expressly required by law. 
Mass General Brigham is an integrated academic healthcare system, uniting great minds in medicine to make life-changing impact for patients in our communities and people around the world. Mass General Brigham connects a full continuum of care across a system of academic medical centers, community and specialty hospitals, a health insurance plan, physician networks, community health centers, home care, and long-term care services. Mass General Brigham is a non-profit organization that is committed to patient care, research, teaching, and service to the community. In addition, Mass General Brigham is one of the nation’s leading biomedical research organizations and a principal teaching affiliate of Harvard Medical School. For more information, please visit massgeneralbrigham.org.
Jennifer Street, 617-593-5469
Investor contact:
Debra Sloan, 857-282-0592
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