Nearly half of IE hospitals lost money last quarter — and the biggest ones lost the most

The newest hospital financial data the state has released, covering the fourth quarter of 2025, shows 21 of the 45 hospitals in Riverside and San Bernardino counties lost money over those three months — together dropping about $258 million. The figures, filed with California's Department of Health Care Access and Information, run two quarters behind, so they're the latest available picture rather than a read on this week. But the pattern they show is structural, not a one-month blip.

The losses don't fall evenly. They cluster among the IE's biggest and most essential hospitals: the trauma centers, the teaching hospitals, the county safety net. The lean specialty facilities are mostly fine. The hospitals the region can't do without are the ones in trouble.

Loma Linda University Medical Center, the IE's only Level 1 trauma center and its academic referral anchor, posted a −17.4% total margin in the October–December quarter and a pre-tax loss of $78.3 million — the largest dollar loss in the two counties. Riverside University Health System Medical Center, the Riverside County safety-net hospital where 72% of patients are on Medi-Cal, lost $38.2 million on a −16.2% margin over the same three months. Kaiser's Riverside hospital lost $39.1 million in the quarter, Desert Regional in Palm Springs $27.9 million, and Loma Linda's children's hospital $26.2 million.

The HCAI data points to why. Across the 45 IE hospitals, the median patient mix is 32% Medi-Cal, and Medi-Cal reimburses well below the cost of care. Hospitals where Medi-Cal patients make up 40% or more of the load ran a median total margin of −16.7% in the fourth quarter. Hospitals below that 40% threshold ran a positive 3.6%. The better-performing hospitals are mostly the IE's smaller investor-owned and specialty facilities — rehab, psychiatric, and low-Medi-Cal community hospitals — while the large nonprofit and public hospitals carrying the regional caseload absorb the shortfall.

The median IE hospital cleared a 0.3% margin for the quarter — effectively breakeven — and the sector ran about $29 million in the red once the profitable hospitals are netted in. For operators, lenders, and the major IE employers whose workers depend on these systems, the signal is a region where the hospitals least able to walk away from unprofitable care are the ones least able to afford it.