SCL Health Merger Helps Propel Intermountain Net Income to $2.7B

A contribution of $4 billion from the merger with the Sisters of Charity of Leavenworth Health System helped boost the system’s net income.

Intermountain Healthcare—a Utah-based, not-for-profit system of 33 hospitals—reported that revenue for the first half of 2022 jumped 25% year-over-year and net income increased by 46% year-over-year to $2.7 billion.

Intermountain Healthcare’s increase in net income was due to a contribution of $4 billion from its merger with the Sisters of Charity of Leavenworth Health System, which took effect on April 1, 2022. Despite the rise in revenue and net income, Intermountain saw a 38% year-over-year decline in its operating income to $285 billion for the first half of the year, from $461 billion for the same period in 2021.

As with most hospitals and health systems, expenses continue to be an issue for Intermountain Healthcare. Expenses rose by 31% year-over-year to $5.9 billion from $4.5 billion for the same period ended June 30, 2021. The increase in expenses was spurred by rising employee compensation and benefits, an increase in medical claims, and the continuing rise in the cost of medical supplies.

Analysts are expecting not-for-profit hospitals to have a rough financial journey for the rest of this year. Recently, Fitch Ratings revised its outlook for U.S. not-for-profit hospitals and health systems to "deteriorating" as these organizations continue to be hammered by labor issues, expenses, and "macro inflationary pressures."

Separately, Intermountain Healthcare recently appointed Lydia Jumonville as the interim president and CEO following the departure of former CEO Marc Harrison. Jumonville served as the president and CEO of Colorado-based SCL Health from 2017 to 2022 before the organization merged with Intermountain Healthcare.