Homer’s South Peninsula Hospital saw increases in revenues over the last year but more so in expenses. The facility’s net income is 71 percent lower than this time last year.
South Peninsula Hospital CEO Bob Letson says they compared key indicators for this year’s first and second quarters year-to-date to their Fiscal Year 2015 for a financial snapshot.
Letson: “Our outpatient visits have increased 17 percent, our long-term care days are down by 3 percent, acute care patient days have increased ten percent, and surgeries have decreased nine percent.”
He says their net revenue increased by 8 percent from $28 million to $30 million however operating expenses increased 14 percent.
Letson: “And this is largely due to salary and traveler contract employee expenses, supplies and drugs that are pretty much volume driven, and also professional fees which are volume driven.”
Letson says one reason the hospital’s net income is so much lower this year is because of the addition of new specialties physician clinics which increase expenses initially until those establish a client base.
Letson: “Professional fees increased $1.3 million, the specialties clinics generated after contractual adjustments collections, $2 million but there was still that growth and expenses in order to generate that two million.”
South Peninsula Hospital recently added a New Acute Care Manager and will also soon have a full time OBGYN doctor once she moves from Anchorage.
During Letson’s report to the Kenai Peninsula Borough Assembly Tuesday, Assembly Member Wayne Ogle asked the hospital CEO if continually expanding services while revenues are not covering expenses is a good practice.
Letson says as a critical access hospital they continually adjust services based on which clinics and physicians do not carry their own weight for the hospital.