Big Oregon Hospitals Were Hemorrhaging Money Early This Year

Hospital finances across Oregon earlier this year took a dramatic turn for the worse, according to new data from the Oregon Health Authority, with acute care facilities collectively reporting huge losses in the first three months of 2025.

Expenses ballooned. Revenue, previously at record levels, did not keep pace. Overall, the data shows, hospitals this year reported the worst first quarter operating margins in at least a decade—if not far longer—with collective losses between January and March approaching $300 million.

“Rising costs and payments that don’t cover the cost of care are creating impossible choices,” the Hospital Association of Oregon said in a statement this week after the new tranche of data came out. “Cuts to services, fewer staff, and longer waiting times for care.”

Hospitals are among the state’s largest employers, and the reported financial pain was concentrated among some of the biggest ones. The HAO has warned of potential closures, and the specter of layoffs are in the air. But what this means for workers or patients is not entirely clear.

That’s in part because the data for the first quarter of 2025 is skewed by some particularly bad individual financial performances. Portland hospitals had some of the most significant reported losses statewide—specifically Providence Health & Services facilities, whose reported losses coincided with a large nursing strike.

But even as that system’s Portland and St. Vincent Medical Centers posted first quarter operating losses of $86 million and $99 million respectively—in each case, roughly a whopping third of their reported overall operating revenue during the period—many others struggled, too.

Legacy Health Services’s Emanuel and Mount Hood Medical Centers posted negative operating margins, as they have in prior years. Oregon Health & Science University Hospital, which draws more revenue than any other in the state, barely covered its expenses.

Overall, state data shows that in the first quarter of this year, few Oregon hospitals were in the black at all.

Hospitals were already sounding alarm bells before the dismal report.

“The health care system is buckling,” HAO said in a report this spring in reference to last year’s finances. “Patients can’t find doctors or wait months for appointments...communities are losing health care services. Entire hospitals are at risk of shutting their doors. And federal changes to Medicaid policy could tip some hospitals over the edge.”

Notably, this all precedes the arrival of what many see as the great storm cloud on the horizon: President Trump’s Big Beautiful Bill, which the state expects will dramatically reduce the amount of people who receive insurance through Medicaid, further straining the health care system.

But hospitals say Oregon has some unique qualities that make it particularly difficult to balance the books.

For one, they cite uncommon labor costs. Since 2020, the hospital association says payroll and supply costs have increased more than 40%, outpacing inflation. Oregon has the highest cost-of-living adjusted hourly wage for registered nurses in the U.S., according to a Beckers Hospital Review analysis of U.S. labor data, which shows state RNs make an average of $58 per hour. And hospitals say new regulations bloat these costs further: Providence, for its part, says its system this year hired 300 additional Oregon nurses to comply with the state’s new staffing ratio law.

“Providence is especially challenged in Oregon due to the regulatory environment,” Melissa Dam, a chief financial officer of the division of Providence that covers Oregon, tells WW via email.

Not everyone is sympathetic.

“Not surprisingly, hospital executives are using the latest OHA financial report as yet another excuse to shift blame for the consequences of their own profit-driven decisions onto frontline caregivers,” says Myrna Jenson, a spokesperson with the Oregon Nurses Association, in an email. “Instead of examining their own costly choices, like lavish executive pay packages, expensive marketing campaigns, and a business model built on maximizing profits, hospital systems point fingers at Oregon’s nurse staffing law and the nurse salaries that are necessary to recruit and retain nursing staff.”

Jenson says hospitals were part of a coalition that passed the state staffing law to resolve the crisis of nurse burnout and unsafe patient loads. She says the new data shows that financial pressures are real, particularly given what she describes as the Trump administration’s attacks on health care. But patients and frontline workers, she adds, should not be forced to pay the price for corporate greed or political decisions beyond their control.

“If hospitals are serious about their finances,” Jenson says, “they should start by reevaluating their executive pay scales and wasteful spending, not the lifesaving nurses who keep Oregonians alive.”

Labor costs aside, hospitals cite other state-specific hardships.

It’s a common complaint that the major government insurance plans do not pay what it costs to provide care, but hospitals say this dynamic is more acute in Oregon, which has worked to get a notably wide range of people on Medicaid. (On the one hand, this should reduce the burden of unreimbursed emergency department visits. But hospitals argue it also moves patients off better-paying commercial insurance.) Hospitals add that Oregon suffers from a shortage of beds, increasing costs further by making it harder to efficiently discharge patients.

Dam, for her part, says Providence has found it harder lately to even get paid.

“We are seeing increased difficulty,” she says, “getting timely payments from insurance companies and the state CCOs for services we have provided.”