Coulee Medical Center took a $1.9 million loss on its books for November, 2012, officials announced Wednesday after first briefing employees on the news.
Most of the loss has actually accrued over time, but was recognized on the books now after a recent analysis of accounts. The adjustment does not affect cash, they said, and will have no effect on day-to-day operations.
“During analysis conducted in the past several months, we identified the need to better address the past impacts of uninsured patients and those insured by Medicare and Medicaid,” Chief Financial Officer Joe Vessey said. “By accounting for these adjustments now and implementing procedural changes, we will be better positioned for the future.”
Vessey said about $900,000 of the adjustment accounts for losses from “uncompensated care,” that is, services rendered to individuals with no health insurance.
Just as much of the loss recognizes an adjustment to what the federal Medicare program ($600,000) and the state Medicaid program ($300,000) had estimated would be paid to the hospital during 2012, based on past history.
About $100,000 of the loss was attributed to normal operations, which Vessey said is not unusual for a November.
Vessey, who took over as CFO in September, said he plans to make such adjustments on a quarterly basis from now on, instead of once a year.
He said some of the balances on individual accounts go back earlier than 2012.
Vessey said the medical center’s cash position is actually stronger than it was a year ago. He told Hospital District 6 commissioners at a Jan. 30 meeting that at the end of December 2012, cash on hand stood at $3 million, compared to about $2.5 million a year earlier.
“Coulee Medical Center remains on solid financial footing as we continue our transformation from a community hospital to a regional healthcare system,” Chief Executive Officer J. Scott Graham said in a prepared statement. “Delivering the highest quality healthcare services to the many communities of north central Washington, while meeting the most stringent standards of efficiency, remain our central goals.”
In an interview, Vessey said Coulee Medical Center’s year-end results likely won’t be known until March. That’s because final accounting for Medicare and Medicaid, which use a cost analysis procedure to reconcile actual costs with reimbursements, takes that long to accomplish.
Vessey said such downward adjustments in those programs happen in years when revenues are not as strong for a facility as they have been in the past. The adjustment can also go the other way when income has been stronger.