Hoboken University Medical Center 2010 Budget Overview Public Meeting, February 18th , 2010
HUMC Operating Expenses 2005-2010 in millions (before interest and depreciation)
How was it done? • Staff (non-union as well as our two unions) reduced labor costs by 10% by rolling back salaries and other pay (on-call, overtime) • Physicians reduced expenses by maintaining a 10% roll back from last year and rolling back additional physician contracts this year • Reduced cost of the top two executives by over $1 Million • Received 10% concessions from several vendors • All executive staff gave up incentive payments
What did the employees give up? • Salary cuts of 7% for JNESO and non-union, 6% for 1199J • Elimination of 401K contribution 3% (nonunion) • Reduction in employer benefit contribution for 1199J • Reduction of on-call payments for nurses • Increase of overtime threshold from 37.5 hours to 40 hours • Elimination of benefit time counting towards overtime • Total: $6 Million annually
How do HUMC expenses compare in the State?
Full time equivalents (FTEs) per Occupied Bed: HUMC is 3rd best in the State out of 48 hospitals
Total Expenses per Admission HUMC ranks 7th best in the State out of 48 hospitals
Source 2009 NJHA Fast Report (June 2009)
What are the challenges in 2010 ? • Receiving fair rates from private payers • Improving revenue cycle process, including but not limited to decreasing denials • Compensating for any additional cuts in Charity Care • Increasing our volume, especially surgical volume • Maintaining a high Case Mix Index
Major Initiatives for 2010 • Implement a hospitalist program by June • Open the vascular lab by Fall 2010 • Seek program specific affiliation (s) with quality partners in areas such as cardiology, oncology, neurology • Begin phase II of the OB renovation • Rebuild trust in our community •
DRAFT 2010 BUDGET
FY09
Actual
FY10 BUDGET
Operating Revenues:
Net Patient Service Revenue less Bad Debt
VARIANCE
Disproportionate Share Revenue - MA Total Patient Service Revenues
$ 97,864,115
$ 100,791,261
$ (2,927,146) 3.0%
8,479,491 9,270,610 (791,119) 9.3% 106,343,606
110,061,871 (3,718,265) 3.5%
State Charity Care subsidy (UCC)
14,319,433
14,130,081 189,352
-1.3%
State Hospital Relief subsidy
598,377
-
598,377
0.0%
State Mental Health subsidy
255,947
255,947
-
0.0%
Graduate Medical Education (Mcare & Mcaid)
2,031,745
2,031,745 -
0.0%
Grant Revenues
4,336,051
4,336,051 -
0.0%
Stabilization Grant Revenues
1,000,000
6,000,000 (5,000,000) 500.0%
Other Operating Revenues:
Other
Total Other Operating Revenues
Total Operating Revenues
1,063,797 1,063,797 - 23,605,350
0.0%
27,817,621 (4,212,271) 17.8%
129,948,956 137,879,492 (7,930,536) 6.1%
Net Patient Service Revenue (in millions)
Requisitioned Expenses: Salaries - Employees & Physicians
$ 67,586,280
63,714,968
$ (3,871,312)
-5.7%
Salaries - Residents
1,263,202
1,357,805
94,603
7.5%
Fringe Benefits
19,809,209
19,126,608
(682,601)
-3.4%
Physician Pro Fees
7,474,628
7,478,843
4,215
0.1%
NonPhys Pro Fees & Purchased Srvs
15,743,246
14,587,378
(1,155,868) -7.3%
Supplies
16,495,089
16,923,197
428,108
2.6%
Rentals & Leases
3,430,515
3,352,924
(77,591)
-2.3%
Utilities
2,523,445
2,721,032
197,587
7.8%
Insurance
1,875,316
1,923,827
48,511
2.6%
Repairs & Maint
990,012
1,076,959
86,947
8.8%
944,668
782,057
(162,611)
-17.2%
Other
Total Manager Operating Expenses
Manager/Contractor
HMHA - Direct Organization Costs Total Operating Expenses
138,135,610 133,045,598
(5,090,012) -3.7%
$ 138,135,610
$ 133,045,598
$ (5,090,012)
-3.7%
439,539
450,000
10,461
2.4%
138,575,149
133,495,598
(5,079,551) -3.7%
Income(Loss) From Operations Before Depreciation & Amortization (8,626,193) 4,383,894
(13,010,087) -150.8%
Debt Service Payment
-
- 0.0%
-
-
Depreciation & Amortization Expense
(5,377,335) (5,377,044)
(291)
Income / (Loss) from Operations
(14,003,528) (993,150)
(13,010,378) -92.9%
NonOperating Revenues (Expenses) Interest Expense
(2,624,049)
(2,598,551)
(25,498)
-1.0%
Interest Earnings - Bonds
36,832
36,832
-
0.0%
HUMC Foundation Donation
500,000
-
500,000
0.0%
Fund Balance - Shortfall 2009
-
-
-
0.0%
Sale of Rehab Beds
-
1,200,000
-
0.0%
$ (12,535,876)
-85.4%
Revenues over Expenses
$ (16,090,745) $ (2,354,869)
January 2010 results • Draft financials show $300 K of income before interest and depreciation • January has only 1/3 of the labor concessions, JNESO and 1199J concessions started with pay-period # 3 which falls in February • Annualized payroll based on payperiod # 3, including overtime and benefit savings is exactly on target
Board questions and material provided • Approximately 35 questions were asked by board members last Friday • Questions included lists of employees, contracts, list of cell phones & beepers, tuition re-imbursement, catering expenses, travel expenses, benefit expenses, overtime expenses by department, list of software vendors, IT costs, collections costs, managed care contracts, residents fees, food and housekeeping costs,