St. Christopher’s Hospital expects to nearly break even after years of losses - but its financial lifeline expires next year.

Leaders at St. Christopher’s Hospital for Children are poised to ask a group of Philadelphia health systems that invested $54 million in the financially struggling hospital to double down on their support next year.

The two-year investment from Children’s Hospital of Philadelphia, Thomas Jefferson University, Temple Health, Philadelphia College of Osteopathic Medicine, Independence Health Group, and private donors has been a lifeline for St. Christopher’s, a vital resource for families in low-income North Philadelphia neighborhoods who often have few other options for care.

But a one-time cash infusion isn’t enough to resolve the challenges facing the hospital, where the vast majority of patients are covered by Medicaid, the publicly funded health program for low-income families that pays hospitals much less than private insurance. Many are dealing with chronic health conditions, such as childhood obesity and asthma, for which hospitals receive limited revenue. Without reliable funding, the hospital struggles to meet a rise in the number of children and teens who are experiencing behavioral health problems or who have become victims of the area’s gun violence.

Leaders say they need more financial help to invest in needed facility improvements to continue providing quality care.

“St. Chris cannot outperform the problem,” said Donald Mueller, who was brought on as CEO in 2020 to stabilize the hospital’s financial position.

St. Christopher’s was bought out of bankruptcy by Tower Health and Drexel University in 2019. The hospital reported an operating loss of $97.6 million in 2021, which it narrowed to $10.3 million in 2022. In the fiscal year that ended in June, St. Christopher’s reported a loss of $534,000 — the closest its come to breaking even in years.

“The only way that happened was with support from the community,” said Mueller, who described the financial turnaround as “a remarkable step forward.”

Mueller was hired to lead St. Christopher’s in part because of his track record of financial success with hospitals in Tennessee and Georgia. He faced scrutiny in January after a critical state inspection questioned his leadership because he initially worked remotely from his home in Tennessee for much of the time. Since then, he has been onsite in Philadelphia.

During a recent interview and facility tour with The Inquirer, Mueller pointed to progress made under his leadership: A team of security guards in the emergency department, a $5 million federal grant to upgrade outdated radiology equipment, a new fundraising foundation that in its first year garnered $1.5 million.

His to-do list is longer. He said the hospital is ill-equipped to handle the increase in youth experiencing mental health crises, each of whom requires an individual nurse aide because they may try to hurt themselves. Too many people show up for medical appointments carrying a concealed weapon. And he wants to add to the emergency department more trauma bays to accommodate the rise in gunshot wound victims — 48 so far this year.

In his office, Mueller keeps an inch-thick glossy binder of what St. Christopher’s could someday look like: Renovated patient rooms and waiting areas, state-of-the-art technology, and adding the shell of a new floor to house new services.

“We’ve got plans for lots of things,” he said. “We move at the speed of money.”