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Health system leaders present FY27 hospitals & clinics budget; ARUP reports steady growth
Summary
The University of Utah health system presented a consolidated hospitals and clinics budget projecting $4.6 billion in operating revenue and a target operating margin of about $303.3 million; ARUP reported ~6% growth and a capital plan near $61 million.
University health system leadership briefed trustees on the hospitals and clinics portion of the FY27 budget, presenting consolidated numbers that include projected operating revenue above $4.6 billion and an operating margin target near $303.3 million (6.5%). Presenters said the system expects modest volume growth (3–4%) and face capacity constraints that require throughput and efficiency improvements. Trustees discussed margins, workforce growth and reimbursement pressures.
Executive vice president for health sciences Bob Harder and health-system budget presenters cited constraints on capacity, downward reimbursement pressure from federal policy changes and investments in technology, including AI, to drive efficiency. Harder noted the hospitals and clinics currently show about 66 days cash on hand — below benchmark levels — and said the budget aims to incrementally improve that metric.
Separately, ARUP leadership (CEO Andy Tyre, CFO Kent Ward) presented operational and financial results: ARUP reported roughly 6% revenue growth, projected margins in the low double digits and a capital budget near $61 million for equipment and facilities. Trustees asked detailed questions about departmental margins and benchmarking.
