Carolinas HealthCare reduces 1Q loss - Phoenix Business Journal:

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Investment losses for the latest quarter totalednearluy $101 million. Chief Financial Officerr Greg Gombar anticipates gains in the financia l market in April and May will eraserthose losses. Carolinas HealthCare uses investment earnings forcapitapl expenditures. That money is not used for daily operations. The health-car e system hopes negotiations with several lendersa will cut its interest expenses tied to variablre debt andhigher bank-liquidity fees. Those fees are about $1 million per month. Interest expenses in the first quarterwere $21.89 million.
From an operational standpoint, Carolinazs HealthCare had a strong first saysRuss Guerin, executive vice president for business developmenyt and planning. Net operating revenue climbed 8.6 percent to $1.2 billionn systemwide. Operating income exceeded $24.55 million. The health-care system saw adjusted discharges — a calculationm that gauges patientactivity — climhb 5.2 percent from a year earlier. Growth withibn the health-care system and expense management “id the primary driver why we’rs above budget significantly,” Guerin Carolinas HealthCare spent morethan $106 million on capital projects in the first quarter.
Projects include new operating roomsat CMC-NorthEast and Carolinas Medicakl Center, an expansion of a new hospital at CMC-Lincolnj and construction of health-carwe pavilions in Steele Creek and Waxhaw, which will include free-standin g emergency departments. Challenges in the coming months include managingthe system’s growing bad-debt and charity-care costs, reducing interest expenses and preparinvg for a possible state cut in Medicaid Gombar says. Bad-debt costs were 12 percenf over budget during the first topping $48 million in the first quarter. During the same period last bad debt wasabout $43 million.
The health-care system spent more than $770 million in community care in includingbad debt, charity care and subsidizing Medicare and That equals 18.8 percent of the health-carse system’s net operating revenue. ”It’s a trend everybody’s seeing across the Gombar says. “We can’t control how many peoplew are uninsured, how many people show up at our doorwithoutg insurance.” North Carolina’s budget woes could resultes in a cut of up to 15 percen for Medicaid. That could equate to $36 million in annual losses forCarolinas “Medicaid cuts are the worst economic benefif cut the state can Gombar says. “It’s painful.
” Says “It raises prices for those whodo pay. It makeas no good business sense to do Gombar says every dollar cut from Medicaifeliminates $4 from the economy. Carolinas HealthCarse is the largest health-care system in the Carolinas andthe third-larges t public system in the nation. The systen owns, leases or managesw 25 hospitals. It has more than 40,000 full-- and part-time employees.