University cruises while GRHS struggles

 

As they were back in April, Georgia Regents Health System is struggling to meet its financial goals but vowing to increase patient revenue while University Hospital is chugging along ahead of budget.

In separate meetings Thursday of the two health systems’ boards, Georgia Regents found itself at the end of May with a margin of $10 million with one month to go in its fiscal year, about $15.5 million behind budget and $5.5 million less than the prior year. University, on the other hand, was $3.4 million ahead of budget through May and $13.4 million ahead of last year at that point.

Both health systems were affected by the ice storm in February but “it didn’t slow us down,” said Dave Belkoski, the chief financial officer for University. “We’re still delivering.”

In fact, before taxes, depreciation and amortization, University generated nearly $33.7 million through the end of May. University’s boards voted to spend $8.6 million to replace its aged phone system and almost $600,000 to upgrade cell service within the health system. University CEO Jim Davis said when he was starting off in health care he installed that same phone system University is replacing in another hospital – in 1983.

Georgia Regents took a heavier blow from the bad weather in February but also from a poor job of moving patients through the hospital and $20 million more in supplies and other expenses than budgeted, even though salaries and wages were below budget by more than $4 million, said Chief Business Officer Tony Wagner.

“It has everything to do with the age of our facility, with the difficulties that we find in operating our facility,” he said. “That’s a big swing in expenses that we’ve got to try to mitigate for next year.”

Georgia Regents University President Ricardo Azziz, who is CEO of the health system, said net patient revenue is higher than last year and shows some signs of progress.

“It’s just not as high as we would like,” he said.

For its next fiscal year beginning July 1, the health system will be shooting for a lower margin but with “significant reinvestment” in clinical growth and patient care, Wagner said. That includes about $5 million more next year for nursing services, he said.

“We have to improve care at the bedside,” Wagner said.

It means cutting about $8.5 million in costs, which will be difficult, he said.

“We are a low-cost provider so the opportunities for us to drive down costs are not as great as they would be and a lot of that has already been driven out of the system,” Wagner said. “Nonetheless, we do hope to be able to drive lower costs.”

Next year’s budget will also be banking on higher admissions from cardiovascular, cancer, digestive health, neuroscience patients and admitting more patients to Children’s Hospital of Georgia, he said.

“We need to grow the children’s hospital,” Wagner said.

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Sun, 12/04/2016 - 20:05

Pardon our mess