Board: Rework ailing budget
Center officials will rework their budget after a lower-than-expected
tom line in the quarter that ended Sept. 30 and possible red ink
firm numbers were not yet available, it appears that the Health
System lost money in October, Larry Fitzgerald, associate
vice president of finance for the hospital, told the Board
of Visitors Health Affairs Committee at a meeting Nov.
members William H. Goodwin Jr. and Thomas A. Saunders III advised
Fitzgerald that it would be wise to recalculate a more realistic
budget now, in light of the negative numbers.
the quarter that ended in September, the hospital operated at
a $2.3 million margin of revenues over expenses which Fitzgerald
said was not good, being $6.7 million under what had been forecast.
Still, it was better than many similar institutions, hr pointed
out. Patient days were up and net revenues increased compared
to last year, but so did total operating expenses.
blamed a 7 percent drop in admissions to the hospitals turning
away patients earlier in the year because there was no room, producing
a lingering effect on referrals.
expenses for the Medical Center, as of the end of September, were
slightly below budget, but 12.6 percent higher than last year,
with salaries and wages both over budget.
E. Nick Carter Jr., the Health Systems chief
operating officer, assured the board that managers are developing
plans to have labor costs under control and in line with the budget
by Jan. 1.
members were also treated to some good news about the hospital
finances: a reduction in nursing turnover and an increase in bed
capacity. Pamela Cipriano, chief clinical officer, said 28 percent
of the nursing staff are temporary workers, which is a savings
on benefits, but a greater expense for wages. She said 30 of these
would be gone by the end of the year, replaced by permanent nurses
coming into the system.
said a performance improvement project has identified $30 million
in cost containment and increased revenues to be achieved over
the next two years. He said $19 million of that comes from added
revenue, including reimbursements to which the hospital has been
entitled but not pursuing.
other business, the board reviewed a study on how other universities
structure their relationships with their hospitals and their physician
practice organizations, such as the Health Services Foundation.