Higher costs and investment losses contributed to Cleveland Clinic’s volatile financial results in 2022.
The Ohio-based organization reported a net loss of $1.25 billion in 2022, compared with a profit of $2.21 billion in 2021, according to unaudited results released Wednesday. Operating expenses increased 13.6%, or nearly $1.5 billion, to $12.45 billion, including wages and salaries up 13.8% and pharmaceuticals up 13.7%.
The loss of more than $1 billion was related to the Cleveland Clinic’s underperformance in the financial markets.
Annual revenue grew 4.5% to $13 billion.
This past year’s results were a far cry from 2021, when the Cleveland Clinic recorded its strongest fiscal year and saw record clinic activity.
For the fourth quarter, the Cleveland Clinic reported net income of $290.12 million, down 45.6% from a year ago. Operating expenses rose 8.5% to $3.23 billion, driven by a 6.9% increase in revenue. wages and salaries and an 18% increase in pharmaceuticals, among other factors. Quarterly revenue grew 5.5% to $3.53 billion.
Health systems across the country continue to struggle with an inflationary environment.
Other nonprofit systems have had similar results. Oakland, California-based Kaiser Permanente posted a net loss of $4.5 billion in 2022. Last week, Indianapolis-based IU Health reported a loss of $715.11 million. The Mayo Clinic in Rochester, Minnesota, saw year-on-year gains drop by nearly 60%, even though it recorded net income of $2.2 billion for 2022.
