Hospital audit reveals financially successful year

This article submitted by Peter Jacobson on 12/29/98.

The audit report for fiscal year ending Sept. 30, 1998, was presented to the Paynesville Area Health Care System [PAHCS] Board of Directors at their regular monthly meeting held on Wednesday, Dec. 23. Jeff Radunz, partner, representing Deloitte and Touche, presented the board with the audit.

The audit revealed a financially successful year for PAHCS. Total operating revenues for fiscal year ending September 1998 were $11,589,000, as compared to $10,695,000 for 1997, which is a 11.1 percent increase. Total expenses for 1998 were $11,784,000, compared to $10,767,000 for 1997, a 9.4 percent increase.

The bottom line for operating funds showed an income of $103,000 compared to a loss in 1997 of $72,000. ďThis change represents a $175,000 turn around in financial position, which is very positive for PAHCS,Ē Radunz said.

A closer look at the revenue sources showed $9,913,000 for hospital revenue for 1998, as compared to $8,758,000 for 1997, a 13 percent increase. The revenue increase for Koronis Manor was essentially flat at $2,444,000 for 1998, as compared to $2,436,000 in 1997. Also showing a modest increase was revenue from 700 Stearns, with a 1998 revenue of $302,000 compared to $295,000 for 1997, a two percent increase.

Clinic revenues showed the largest gain, with $3,302,000 for 1998 as compared to $2,679,000 for 1997, a 23 percent increase.

The net revenue for 1998 was adjusted downward when allowances were made for contractural adjustments to incomes for the hospital, clinic, and manor. These allowances are the differences between the established rates for services rendered by PAHCS and the amount PAHCS receives for those same services from third party payers, including medicare, medicaid, and insurance companies. For 1998, that allowance was $4,372,000, compared to $3,752,000 for 1997, a 16 percent increase.

The tax increment financing [TIF] for the proposed new PAHCS clinic in Richmond was approved at the last Richmond City Council meeting held Dec. 16, 1998. The council will also be sending a letter of intent to the PAHCS board to join the hospital district. Legislation will also be enacted with the help of Senator Michelle Fischbach and Representative Doug Stang to allow Richmond to join. The special legis-lation is needed because Richmond is not contiguous to the district.

ďSignificant population growth is taking place in the Richmond area,Ē Administrator Willie La Croix said. ďThe city of Richmond passed the vote on joining the hospital district, which is also a positive sign for building a new clinic in Richmond,Ē he added.

The PAHCS board approved moving ahead with the Richmond clinic project. Engan and Associates, the architectural firm who designed the new PAHCS clinic, will be engaged to work on the new Richmond clinic. The TIF district resolution contains a 15-month window for the construction of the clinic. The building needs to be completed by March 31, 2000. The TIF district will return $17,000 in real estate taxes per year for the first nine years to PAHCS, making the new clinic project feasible, according to LaCroix.

The PAHCS board approved the continued pursuit of Dr. Roger Dreylingís clinic for the purpose of a complementary medicine facility, which could include chiropractic services, massage therapy, and psychology. An application will be prepared by PAHCS for a national grant, available through the University of Minnesota, to develop multi-disciplined clinics. This grant, if received, could help with the purchase and development of this clinic.

The board also approved the hiring of Dr. Jack Guy, New London, for approximately two days per week at the Eastside Medical Clinic in Belgrade. This will allow Dr. Tom Sult more time to see patients at the Paynesville Area Medical Clinic.

In other business, the board:
ēmade the following physician appointments: Bernard Erickson, M.D., consulting staff, cardiology; and Gene Beavers, P.A., ancillary staff.

ēmade the following reappointments: James Anderson, M.D., cardiology; Robert Glesne, M.D., urology; Richard Jolkovsky, M.D., cardiology; Keith Leavell, M.D., pulmonology; David Lindgren, M.D.,OB-GYN; Hoan Nguyen, M.D., radiology; David Roberts, M.D., gastroenterology; Tereasa Simonson, M.D., radiology; and David Webster, M.D., neurology, all to the consulting staff.

ēreappointed Gregory Friederichs, O.D., optometry; Laura Odell, PharmD, pharmacy; and Wendy Worner, C.R.N.A., anesthesia, to the ancillary staff.

ēreappointed Randy Nelson, D.O., family practice, and Randall Zimmerman, M.D., family practice, to the active staff.

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