With the prospect of health care reform radically reshaping the landscape next year, University Hospital officials said they are facing an uncertain future and their budget for next year reflects that.

"It makes us look very conservatively at what next year is going to be, right off the bat," said J. Larry Read, CEO of University Health Care System.

"I can't say we specifically factored anything in," Chief Financial Officer Dave Belkoski said. "We don't know. What we do know is payments will be cut. And we factored that part in."

The budget for next year, for instance, does not include the $8 million in supplemental Medicaid funding the hospital received this year, payments that have been targeted for cuts to help pay for the reform bills.

Medicare payment adjustment increases have also been looked at.

The hospital is budgeting for $429 million in total revenue, about $6 million less than it is projecting for this year.

To help make up for that, the budget for next year calls for about $7 million less in salaries and benefits. A lot of that comes from limiting overtime, something the health system already looks at and manages on a daily basis, Mr. Belkoski said.

There is no personnel reduction planned but if it does need to be reduced it can be done through attrition, Mr. Read said.

One key area is reducing the time a patient actually spends in the hospital, known as length of stay. University is aiming to reduce it by 3 percent next year, a reduction of 3,300 patient days. Because most of the reimbursement University receives is by discharge, which is projected to remain the same, reducing the length of stay means less nursing and personnel time needed and thus less cost, Mr. Read said.

The main thing is just managing whatever changes health care reform brings in the future, he said.

"We need to figure out what that legislation is going to do," Mr. Read said. "We know that we're headed to less reimbursement over time. We know that. How quickly, how much, that is yet to come.

"The good news," he added, "is we have a little time."