UHS posted $163.1 million in net income for the first quarter compared to $153.9 million in the prior-year period, driven by growth in acute care volumes. Same-facility adjusted admissions in its acute care centers increased by 10.5% and adjusted patient days increased by 3.7% compared to the first quarter in 2022.

However, net revenue per adjusted admission for UHS’ acute care unit decreased by 7.5%, influenced by lower COVID-19 admissions — and a loss of subsequent federal COVID-19 funding — compared to the prior-year period. Coronavirus admissions comprised 4% of acute care visits in the first quarter compared to 14% in the first quarter of last year, UHS CFO Steve Filton said during a Wednesday earnings call.

Although the operator is experiencing “broad based” recovery from the COVID-19 pandemic across the hospital industry, non-COVID-19 volume recovery has been “a bit slower than anticipated,” Filton said.

Filton also reported that temporary labor costs were coming down for the operator. Hospital systems relied on pricey contract labor costs to stem workforce shortages during the pandemic. UHS reduced its premium wage pay from a height of $153 million in the first quarter of 2022 to $85 million during the first quarter this year, the CFO said, adding that an increase in volumes was a major reason why premium pay had not declined further.

The operator’s behavioral care units also experienced an increase in patient volumes. Same-facility adjusted admissions increased by 7.5% year over year, with revenue per adjusted patient day increasing by 5%.

UHS was able to renegotiate contracts with its lowest payers, as the operator experienced capacity strains exacerbated by behavioral unit demand, which led to the 5% increase, Filton said.

Net revenues for UHS increased by 5.3% to $3.5 billion during the first quarter of 2023, compared to $3.3 billion during the first quarter of 2022.

The operator is adopting a “wait and see” attitude regarding Medicaid redeterminations, which executives expect will have a modest negative effect on both its behavioral and acute care segments. In April, states were allowed to start culling Medicaid members from their rolls.