by Chris Neuswanger
The 3rd quarter financials of the Vail Valley Medical Center were just released, and I thought a community update might be in order. The VVMC does not release these (even if requested) to the public but they can be found on line with the mandatory public record bond disclosures required by the VVMC issuing $100 million in bonds to help pay for the new construction at the hospital (which is now about $120,000,000 over budget).
The VVMC continues to make profits at a record breaking pace and assets continue to increase. Revenues for VVMC are up slightly showing an increase for 9 months of $3.2mm over the same period last year, or a 2% growth rate. This is indicative and verifiable evidence of the VVMC’s assertions that they kept price increases to about 2% over last year.
Profit wise the VVMC has made tax free net income and other non-operating income (such as interest and dividends) of $39,182,672 for the first nine months of its fiscal year. That is an increase of $4.9mm of 15% over the same period last year. The VVMC has eclipsed it previous profit margins of last year, making a record shattering 28% of gross revenues as net income over the 25% for the first 3 quarters of last year, and is on track to surpass its’ overall average profit margin for last year of 24%. Historically the profits of the VVMC have grown about five times faster than revenues, now they are growing seven times faster.
Typically non-profit hospitals generate from 2% to 7% profit margins, using standards developed by the American Hospital Association as measurement guidelines. Historically, the 4th quarter (which we are now in, has been one of the most profitable for the VVMC, making it likely it will substantially surpass its previous year excess revenues of $52 million.
Liquid assets (which include investments, cash, and net pledges, but not bond proceeds, real estate or inventories) equal $280,060,592. That is a increase $8.8million from a year ago.
In addition, the VVMC is making all this money tax free, they do not pay a cent towards the schools, roads and government services. By comparison, property taxes on a 300 sq foot commercial office condo in Avon run nearly $1,000 per year but the VVMC which holds real estate and personal business property worth hundreds of millions of dollars does not pay a penny. Every cent of the $52million in profits the VVMC made last year was exempt from Federal and state income taxes. Purchases of supplies and inventory worth tens of millions was exempt from state and local sales taxes.
To learn more about the finances of the VVMC and view a full copy of the quarterly financial report visit: http://www.vvmcmoney.com
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Macro Financial Group
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