The Allegheny Health Network reported an operating loss of $23.4 million for the first three months of 2021, financial documents released Friday show.

Despite starting the year in the red, AHN Chief Financial Officer James Rohrbaugh said the 14-hospital system remains on solid financial footing. He points to patient visits bouncing back toward pre-pandemic levels as the region’s vaccination rate climbs.

The system’s unaudited first-quarter results mark an improvement from the start of 2020, when covid-19 struck Pennsylvania and AHN took a $59.5 million loss.

“We’re encouraged by the results in the first quarter. We’re definitely trending in the right direction,” Rohrbaugh told the Tribune-Review by phone. “As people got vaccinated, we began to see a return to people accessing services that they needed.”

Prior to the pandemic, however, AHN had been reporting quarter after quarter of record-high revenues, including a $19.1 million gain during the first three months of 2019.

Hospital visits ramped up in March, April

Rohrbaugh attributed this year’s losses to a combination of increased costs — including a persisting shortage of nurses resulting in spikes in costs for overtime and outside staffing agencies — and lower-than-usual hospital volume, particularly before the covid-19 vaccine became widely available.

Compared to the same quarter last year, patient discharges and observations were down by 4.3% and emergency room visits dropped by 5.9%.

More recently, as vaccinations increase and restrictions ease, more patients are seeking services, including some who may have been postponing treatments because of the threat of covid, Rohrbaugh said.

“It was still a challenging time in January and February,” Rohrbaugh said, “but as we started getting more people vaccinated, we saw a very different story in March and April.”

In March, AHN recorded the highest number of patient admissions and observations that it has in any of the past 12 months, according to Rohrbaugh. During April, inpatient surgeries climbed by 46% over April 2020, and outpatient cases climbed a whopping 288% from the same time last year.

As of this week, AHN has helped distribute more than 350,000 covid-19 vaccine doses to nearly 200,000 people, including via some of the region’s first-available mass vaccination clinics at PNC Park, the Pittsburgh Mills mall, the Monroeville Convention Center and Erie Insurance Arena in Erie. The clinics also enabled AHN to interact with more than 60,000 patients who had never been to a AHN facility, or had not done so within the past three years, according to Rohrbaugh.

Patients pivot to non-hospital settings

Though more hospital beds sat empty, AHN’s outpatient patient volume during the first three months of this year grew by 43.5%, data show. More people seeking treatments at surgery centers helped increase total surgical cases by 4.7%, and total physician visits climbed by 5.4%.

“We’ve seen a pivot of the site of care. So instead of people coming to the emergency room, for example, we’re seeing virtual care, they’re ending up in an outpatient setting,” Rohrbaugh said. “In terms of delivering health care, that’s the right thing. Patients need to be taken care of in the right place.”

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First-quarter net patient service revenue, or the amount paid for patient services, grew by 8.5%, up to $907.2 million.

“There’s a few things driving that,” Rohrbaugh said. “One is the outpatient volume is up. And the case mix is up: Because patients are sicker, they’re in the hospital a little bit longer, they’re receiving more services, and as a result, the revenue related to them is up as well.”

AHN’s net assets have climbed to nearly $4.5 billion, up from $3.9 billion in March 2020 and $3.2 billion in 2018. Its network spans more than 19,000 employees, including more than 2,400 physicians and 200 primary and specialty care offices.

AHN is the medical care provider arm of Downtown Pittsburgh-headquartered Highmark Health.

Its parent company, Highmark Health, has net assets topping $9 billion, up from $7.6 billion in 2019.

RELATED: Highmark boasts $490M operating gain in 2020 — better than pre-pandemic

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