122710 Wooster Community Hospital submits 2011 budget
By Sharon Haught
December 14, 2010
291
During their December 6 meeting, the members of the Wooster City Council Finance Committee had an opportunity to hear the details of Wooster Community Hospitals budget for 2011
Hospital Chief Financial Officer, Scott Boyes, noted that the hospitals budgeting process began last summer when the managers and medical staff were asked to provide volume projections for medical services for the coming year and culminated in the approval of the budget by the Board of Governors in November, which is brought before city council as part of the citys 2011 budget for approval.
The hospital projects growth of 2.7 percent in inpatient admissions due to the addition of a new spine surgeon and the new service line his practice brings to the hospital and growth in the practice of a relatively new reconstructive plastic surgeon.
Inpatient rehabilitation admissions are also projected to rise 3.4 percent due in part to the anticipated receipt of stroke accreditation for the hospital in 2011.
According to budget projections, the number of nights patients stay in the hospital is projected to rise from 16,931 in 2010 to 17,486 in 2011, which represents a 3.3 percent increase.
Even with new competitors such as the Cleveland Clinic Surgery Center entering the Wooster market, according to Boyes the hospital is expecting to see a rise in surgical cases of nearly five percent with the addition of a new general surgeon to the staff.
According to Boyes, even with the addition of several new minor treatment centers in Wooster emergency room visits are also expected to grow by 1.4 percent to 31,721 visits in 2011.
Boyes noted that the number of staff members in 2011 will remain stable at 700 full time equivalents and that the budget takes into account a two percent salary increase for hospital employees approved by council later that evening.
The budget approved by the hospitals Board of Governors also calls for a five percent increase in the rates charged by the hospital for services.
Boyes noted that even with the five percent increase the hospitals prices are still in the lowest tenth percentile in the state when compared to other hospitals even to the point that occasionally our prices are lower than what the federal government wants to pay us for certain services.
We also want to make sure that our prices are capturing whats allowed within our managed care contracts, said Boyes noting that the contracts contain a provision for increase in reimbursements to the hospital to help us with inflation, help us with wage increases, and unless you adjust your prices you will not be able to access those increases in your contracts.
Boyes noted that in 2011 the hospital is anticipating an increase in our operating margin to $6.7 million compared to $6.3 million in 2010. According to the budget just shy of $5 million of that will be transferred to the Wooster Community Hospital Foundation in support of its physician recruitment and support of its physician retention through Bloomington Medical Services, which is the subsidiary the Foundation created to provide a vehicle for us to hire physicians.
When interest income in taken in to account, the budget for 2011 projects a total cash flow to the hospital of just over $10 million.
A total of $10.3 million in capital projects are also included in the budget for 2011 including $5.5 million for the upgrade of equipment in various hospital departments, $3.75 million for the renovation of one floor of the old patient tower into physician offices and $400,000 for the relocation of the endoscopy unit within the operating room area.
