UAMS Hospital Loses $3.8 Million In First Half Of FY 2012

by Mark Friedman  on Monday, Feb. 20, 2012 7:33 am  

UAMS Chancellor Dan Rahn attributes the losses to a shortage of business. But he also said a higher percentage of those patients who did come to UAMS didn?t have insurance, a problem other hospitals are encountering.

He said having more people with health insurance would help the hospital’s finances. But uncertainty surrounds the federal Patient Protection & Affordable Care Act of 2010, which would require most people to have health insurance by 2014, as it makes its way to the Supreme Court this year.

UAMS also has seen an increase in emergency room visits. Since UAMS opened its 10-story hospital in January 2009, trips to the ER jumped from an average of 3,286 per month in fiscal 2008 to 4,516 in fiscal 2011, according to UAMS’ audit for the year ending June 30.

Consulting Firm

Rahn said UAMS’ financial health would have been worse if it hadn’t been for Navigant Consulting Inc. of Chicago.

In February 2010, UAMS hired the consulting company to comb through its revenue and expenses to improve the bottom line. Navigant projected it could save UAMS $42 million. At the time, UAMS was losing about $3 million a month.

From February 2010 through April 2011, though, Navigant said it saved UAMS $46.6 million by trimming expenses and increasing revenue, according to a May 6, 2011, report from Navigant, released to Arkansas Business under a Freedom of Information Act request.

Goodhand said the savings could be found in the financial statement for UAMS, but the cuts in expenses and increased revenue extend over two fiscal years. For the fiscal year that ended June 30, 2011, UAMS’ operating loss was $29.4 million, compared with $58 million for the year that ended in mid-2010, a $28.6 million improvement.

Still, UAMS — the hospital and the educational institution combined — had another $71.6 million in non-operating revenue (state appropriations, gifts and investment gains) that more than offset the operating loss, leaving $42.2 million in income for the year that ended June 30, 2011. That compares with $20.3 million a year earlier.

UAMS has spent $11.6 million on Navigant’s services so far, according to a UAMS spokeswoman.

Pierson said that searching for ways to trim costs while trying to boost revenue would never stop. “This continual trying to become more efficient while maintaining high quality and [keeping] patients happy is what the future is all about,” he said.

 

 

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