Tremendous Opportunity & Development
Fiscal year 2014 was one of tremendous opportunity and development for National Jewish Health. We signed a joint operating agreement with Saint Joseph Hospital and SCL Health for our Colorado-based clinical programs. This arrangement enables us to provide inpatient care in a new, jointly managed hospital that will open in December 2014. Providing the ultimate patient experience along the full continuum of care, from outpatient to inpatient, is a signal tenet of our 10-year strategic plan. This agreement will allow us to achieve this goal much sooner than anticipated.
We also closed an agreement to create a joint Respiratory Institute with the Icahn School of Medicine at Mount Sinai in New York City, which will enable us to impact the lives of many more patients who cannot travel to Denver. Both ventures are expected to add significantly to our future financial success.
Patient revenues grew 7.3 percent during the year. We acquired two substantial oncology and hematology practices as complements to our lung cancer strategy. National Jewish Health physicians also began providing nightly Tele-Intensive Care Unit services for 21 additional hospitals across five western United States. On a challenging note, in January, Medicare began denying payment for many laboratory services done on the same day as a physician visit. This hit National Jewish Health harder than many providers because of the intensive work-ups that we perform in a short time for our unique tertiary and quaternary referral patients from around the United States. In spite of this, net patient revenue grew by $8.6 million.
Thanks to our loyal donor base, we raised $30 million for the second year in a row. The ongoing success of our fundraising efforts will enable us to continue expanding the reach of our clinical and research programs.
Research funding across the country continues to be negatively impacted by the flat National Institutes of Health budget. National Jewish Health scientists continue to pursue new funding sources. Non-federal funding increased more than 20 percent during the year. Total grant funding remained flat for the year.
Expenses & Investments
Expenses increased approximately 5 percent during the year. The majority of the increase is attributable to the significant legal and other costs incurred to close our arrangements with Saint Joseph Hospital and its parent SCL Health, and the Icahn School of Medicine at Mount Sinai, and to the expenses related to the acquisition and operation of the new oncology and hematology practices.
National Jewish Health investments benefited from strong financial markets. More than $17 million in investment gains were recorded. Total net assets increased $11.6 million for the year.
We continue to execute our strategic plan, which will enhance our ongoing financial performance. Through new ventures and expansion of clinical programs, investments in our research enterprise and our continued fundraising success, National Jewish Health will achieve another century of programmatic and financial success on behalf of the patients we serve.
Overview of Revenue and Expenditures
*Data in Millions