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Whidbey General continues cuts

Administrators at Whidbey General Hospital continue to crunch numbers and make cuts in order to produce a healthier budget for 2003.

A draft shows that the hospital’s budget is balanced, with a little over $1 million left over. But that scant amount, which is a 1.9 percent margin, has hospital officials worried.

“It doesn’t give us any breathing room at all,” said Doug Bishop, chief financial officer at Whidbey General Hospital.

Scott Rhine, chief executive officer, said a 5 percent margin is necessary so the hospital can introduce and maintain new services to meet the needs of the community and to keep up with inflation.

He added that money also needs to be available to maintain competitive wages in hiring people.

To increase the margin the hospital administration is planning to make several adjustments to increase revenue and will shave some money from various departments throughout the hospital.

However, the cuts should have a minimal effect on patients.

“We’re not trying to eliminate any services,” Rhine said.

He added that there will be changes. For example, adjusting the scheduling in rehabilitation services could earn the hospital $100,000 and officials are considering charging a fee for ambulance standby services.

If the changes are approved, more than $650,000 in revenue will be added.

“People will see more efficiency as we strive to maintain services in the community,” Rhine said.

The budget is scheduled for approval at the Feb. 10 Board of Commissioners meeting. The hospital has been operating within the parameters of the 2002 budget ever since the beginning of the year.

Hospital administrators normally approve the budget in December, but have been wrangling with the budget for months due to a technical problem with the hospitals information systems. The budget was also delayed because the hospital had to reorganize after the loss of 20 employees.

To help save money, hospital officials asked its employees in November to voluntarily resign. Twenty employees took the offer and it will save the hospital between $800,000 and $1 million.

There is some good news in the budget as a 14.4 percent increase in revenues is being forecasted. The increase is attributed in part by new services, such as CT scans and MRI services being available on Saturday.

But with the revenue increase, the hospital is also dealing with a 19.8 percent increase in write-offs. The hospital is expecting to write-off more than $30 million compared to $26 million last year. The loss is due in part to declining Medicare and Medicaid reimbursements.

Bishop said that the hospital receives 50 cents for every dollar billed to Medicare and 20 cents for every dollar billed to Medicaid.

He added that Medicaid payments often take 150 days to go through.

“We get paid very little and have to wait a half a year to get it,” Bishop said.

As hospital officials hammer out the final details of the budget, they continue to watch the economy and see how it effects the hospital.

“It could go north or south on us,” Bishop said. He said that other hospitals are dealing with similar problems.

Providence Everett Medical Center recently announced that it will cut 350 jobs in a cost-saving maneuver.

In the coming months, Whidbey hospital officials are considering adjusting staffing levels to accommodate patient flow and cash flow.

Nathan Whalen can be reached at nwhalen@whidbeynewstimes.com

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