After the invocation, the pledge, and roll call, Chairman Cindy Tomberlin turned the meeting of the Baxley-Appling County Hospital Authority over to Ray Leadbetter, recently hired as a financial consultant, for the financial report. He reported that there are things that concern him about the financial condition of the hospital now, but things that make him see great opportunity as well. Income has dropped rather drastically from 2018, 2019, 2020, but it mostly has to do with COVID-19. Some things will have to be written off as bad debt and they will have to figure out how to fix it. If the numbers are correct, there has been a 5.15 percent increase in collections, but a 39 percent increase in salaries, bonuses, and benefits. Overall expenses have gone up 32 percent. Total income is about $600,000 lower than in 2018. There is a posting issue going on.
COVID started hitting hard in 2020. Some COVID funds were paid in 2020, but not all were recognized. A lot of that money has been flowing through the system but should have gone to the general operating fund. They will be recognizing some HHS money and are still working through the process.
Ambulance subsidy went down by $100,000. Rural tax credit is a great opportunity. Each hospital can get up to four million dollars. Appling will probably never get the full four million, but Leadbetter says he has seen hospitals get up to $2.5 million. Income lost is projected to be about two million dollars. You must include the hospitalist revenue, but you must include the expenses too.
He explained that he broke it down into different areas to examine it closely. The Pavilion is losing $350,000. He says they must get the nursing home back to making a profit. There’s an opportunity there.
If they include all the clinics for these 11 months, they lost $845,000. EMS made $3,700. The jail lost and Appling Pediatrics lost. A profit is possible after COVID but harder.
The system is now losing $655,000 per month from operations. That money is gone. The losses in June and July are overstated. The average revenue was 4.9 million dollars for June and July. This situation is common in healthcare now. You must be able to meet your principal payments and focus on the volumes and how to get operating costs down.
All too often systems don’t get reminded that they still have loans due. You must have at least $730,000 to make minimum payments on your obligations. The goal is to make a profit and make at least minimum payments. We must focus on profitable service lines.
With no further questions, the board voted unanimously to accept the financials and went into executive session. Upon return to open session, they voted to close the Vidalia and Blackshear Clinics.
The meeting was then adjourned.