Title
Receive Natividad Medical Center’s Financial Report for the fourth quarter (April 2022 thru June 2022) of fiscal year 2022.
Report
RECOMMENDATION:
It is recommended that the Board of Supervisors' Budget Committee receive Natividad Medical Center’s Financial Report for the fourth quarter (April 2022 thru June 2022) of fiscal year 2022.
SUMMARY/DISCUSSION:
The average daily inpatient census (ADC) for the quarter was 123.9 compared to the budget of 114.0. Psychiatric patient days were below budget for this period, while Med/Surg, NICU, PEDS, ICU, Rehab, and OBGYN census were higher than budget. Patient days for the quarter were 9.9% higher than budget due to increased Med Surg, OBGYN, ICU, and Rehab patients in the quarter; a portion of the increase is attributable to COVID patients. The average adjusted patient days (including inpatient and outpatient volumes) were 16,020 compared to a budget of 14,795, favorable by 8.3%. Emergency Department visits for the quarter were 13,787 or higher than budget by 3.3%.
The total net margin for the quarter was positive (revenues more than expenses) at a gain of $16.1 million compared to the budget net margin of $2.5 million. Included in revenues was a one-time payment from Kaiser of $14.2 million from a Kaiser settlement related to trauma contract rates. Excluding the one-time settlement, the net margin for the quarter was positive at $1.9 million.
Net patient revenues totaled $90.9 million for the quarter compared to a budget of $65.4 million. Net patient revenues were significantly higher than budget by 39.1% due to the Kaiser patient claims settlement of $14.2 million, strong inpatient days, and professional fees revenues. Revenues from Government Funding were $18.0 million compared to the budget of $14.0 million. The lower revenues from other operating revenues resulted significantly from decreased interest income due to the lower interest rate for the quarter. Operating expenses for the quarter were $94.9 million compared to a budget of $79.0 million, or an increase of 20.0%. The increase in costs was related to treating COVID-19 patients. Expenditures for salaries and benefits increased by $3.4 million compared to budget, nurse travelers increased significantly compared to budget by $4.7 million, physician costs increased by $3.1 million, supplies including medications increased by $2.1 million, and other expenses including patient equipment rentals increased by $104,000.
For the twelve months ending June 2022, the average daily inpatient census was 126.5 compared to a budget of 114.0 or favorable by 11.0%. Adjusted patient days (including inpatient and outpatient volumes) totaled 65,001 compared to a budget of 59,997, a favorable variance of 8.3%. Emergency Department visits of 53,072 were higher than the prior year by 26.0% but less than budget by 2.0%.
The net positive margin for FY 2021-22 was $19.0 million compared to a budget of $7.6 million. Net patient revenues totaled $307.6 million compared to the budget of $262.1 million. Net patient revenues were higher than budget by $45.5 million or 17.4%. Revenues from Government Funding totaled $73.1 million and were 10.3% higher than the budget. Other operating revenue totaled $8.2 million and was 11.5% lower than budget due to lower actual interest income recorded for the year. Operating expenses year-to-date were $369.9 million compared to the budget of $326.6 million. The negative expense variance of $43.3 million or 13.3% was attributed to FY 2021-22 expenditures for registry of $14.6 million, physician and contract fees of $9.6 million, purchased services of $1.2 million, and supplies of $9.9 million. Of the $43.3 million negative expense variance, $8.7 million was COVID-19 related expenses. Registry expenses continued to trend high due to higher patient days, care of COVID-19 patients, and backfilling for nursing staff on sick leave and open positions.
Collections from patients and payers were $280.4 million for the year. Balance in cash Fund 451 was $146.0 million in June 2022, State and Federal Intergovernmental Fund was $111.5 million, Capital Fund was $68.5 million, and the Strategic Reserve was $25.0 million.
Net patient receivables were $60.7 million or 60.8 days in receivables. Distribution by payer: 8.4, Medi-Cal, 12.2% Medi-Cal Managed Care, 15.6% Medicare, 62.5% Commercial, 0.1% Self-Pay, and 1.3% Short Doyle. Distribution by aging: 23.7% In-House and under process, 43.3% between 0-60 days, 32.5% between 60-181 days and 0.4% over 181 days.
OTHER AGENCY INVOLVEMENT:
None.
FINANCING:
Accepting this report has no financial impact.
______________________________________
Daniel Leon, CFO
Natividad Medical Center
Date: August 9, 2022
Attachment: NMC’s Financial Statements