Tower Health, a nonprofit health system based in Berks County, reported a $27.4 million operating loss for the nine months that ended March 31, compared to a $122.8 million loss in the same period a year ago, to investors on Thursday. Although the company has made progress in improving its financial performance, it has met or exceeded its financial and growth goals throughout fiscal year 2024. Tower remains optimistic about achieving a return to profitability by the end of the year.
Despite the reduction in losses, Tower’s cash reserves continued to decline, reaching 30 days of operating expenses on March 31, down from 32 days at the end of the previous year. This decline was a significant factor in Standard & Poor’s decision to downgrade Tower’s credit rating to CCC.
Tower Health’s revenue for the first nine months of fiscal year 2024 was $1.43 billion, up 2.6% from $1.39 billion the previous year. Excluding Chestnut Hill Hospital’s revenue from the previous year, Tower saw a revenue gain of 7.8%. Additionally, revenue at Phoenixville and Pottstown Hospitals increased by 7.2% to $250.9 million from $230 million.
However, despite these improvements, Tower faced challenges with its operating income, which remained relatively stagnant at about $40 million over the years. Another notable development was Tower’s recent agreement with Cigna to be an in-network provider for Cigna health insurance members effective May 1st
