UAMS Operating Loss May Top $46 Million

by Mark Friedman  on Monday, Oct. 6, 2008 12:00 am  

The University of Arkansas for Medical Sciences will open its $150 million nine-story hospital in January. The Patient Tower will feature larger patient rooms, an emergency department, a clinical lab and a a radiology department.

"If anything, it's a positive," said Wilson, who is planning to retire in June.

Wilson said UAMS has had an operating loss for years and has always needed money from the state of Arkansas.

"We couldn't run [UAMS] without state money," he said.

He said he doesn't consider UAMS operating at a loss because of the revenue stream from the state of Arkansas. For fiscal year ending in 2007, the state's nonoperating appropriation to UAMS was $47.3 million. In the fiscal year ending in 2005, it was $41.5 million.

The operating loss, though, has been steadily rising since the end of UAMS' fiscal year in 2005, when it was $12.9 million. In 2006, the operating loss was $21.9 million. The operating loss jumped to $51.9 million in 2007 and then fell to $17.9 million in 2008.

(Wilson said the operating loss was higher in 2007 than it should have been because UAMS didn't receive a federal payment until 2008, which was why the 2008 numbers are lower than they should be. But the average for the two years was nearly $35 million.)

Wilson did tie part of the projected operating loss this fiscal year to the number of additional employees needed to staff the buildings. UAMS recently added about 300 employees, and more than 200 were health care staff for the new hospital and the Psychiatric Research Institute, said UAMS spokeswoman Leslie Taylor.

"We're probably going to have more people on our payroll for a while before we start getting more income [from] the hospital," Wilson said.

The university's compensation and benefits expense line has jumped from $600.5 million in fiscal 2007 to a projected $696 million in the current year, fiscal 2009.

In the upcoming General Assembly, UAMS will not ask the state Legislature for more money because it built a new hospital, said Richard Pierson, vice chancellor of Clinical Programs and executive director of UAMS Medical Center. "It will be a normal year with our interaction with the Legislature," he said.

Wilson said he plans on asking the Legislature for its annual amount, which is about $100 million, plus a 3 percent increase, which will be an additional $3 million. He also said he would eventually want another $3.5 million to run UAMS' northwest campus, scheduled to start teaching students in 2009, but he said the first year would require less.

New Hospital



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