Wednesday, August 1, 2012
The prognosis for Erlanger at Hutcheson continues to improve.
The hospital’s board was told last week that June was the best month, financially, in nearly two and a half years.
“This [June] was the best month since January 2010,” said Farrell Hayes, chief financial officer for the Fort Oglethorpe-based medical facility.
It was also the second consecutive month with losses that were less than budgeted.
Compared to the same month last year, the hospital had an increased number of admitted patients and surgeries as well as emergency room and outpatient visits.
Those improved numbers of services provided, combined with less-than-projected expenses, resulted in a $1 million improvement compared to June 2011.
“Normally you don’t get excited about reporting a loss, but our June figures were particularly gratifying,” said Roger Forgey, the hospital’s president and CEO. “We have budgeted decreasing monthly losses through January 2013, when we expect to break even.
“The fact that for two months in a row we have significantly better-than-expected financials is a testament to our employees and physicians who are working so hard to make this hospital financially successful.
“We’d like not to report a loss, but we’re continuing to show improvement.”
An increase in collections for services provided to patients has helped the shift toward profitability, but so too are savings of more than $654,000 in salaries and of $254,000 in supplies compared to June 2011.
Forgey noted the result has been that even if there are fewer patients each night the hospital can be profitable. Previously, the hospital needed about 70 patients admitted each day to show a profit. Today, the hospital needs a daily census of 40-45 patients to break even.
Hutcheson Medical Center, formerly known as Tri-County Hospital, signed a management agreement with Erlanger Health System last spring, hence the new name of Erlanger at Hutcheson. As of May 26, 2011, that agreement provided Hutcheson a $20 million line of credit, something that was desperately needed to pay vendors and payroll.
Forgey said it has been several months since the hospital has had to draw from those funds, of which about $9 million remain.
“With the release of this month’s outstanding financial statement I am delighted to report that we’re ahead of schedule in our dramatic efforts to regain profitability,” said Corky Jewell, chairman of the Erlanger at Hutcheson board of directors.
Hutcheson’s annual budget anticipated losing $813,000 in June, far greater than the reported loss of $171,000.
“It’s the best in two years,” Hayes said. “Still negative, but going in the right direction.”