Rice Hospital board accepts 2007 audit
WILLMAR -- Rice Memorial Hospital officially closed the financial books Wednesday on 2007, a year during which the hospital climbed out of a $2 million deficit to earn a $1.8 million net return.
Board members for the city-owned hospital voted Wednesday to accept the 2007 audit.
The financial figures were reviewed in detail two weeks ago by the hospital board's finance committee.
Last year's $1.8 million net margin represents a 2 percent return on hospital revenue of nearly $90 million.
This financial turnaround was mostly due to a reining-in of expenses. The hospital cut more than $2 million last year from its budget, including 32 full-time positions, mainly in support services. Indeed, Rice managed to trim its operating expenses last year from $90.1 million to $89.4 million.
Darryn McGarvey, audit manager with the Larson Allen consulting firm, said it's a rarity to see a hospital reduce its spending.
Hospital officials might be facing a challenge this year, however, at repeating this fiscal performance.
Through the end of February, the hospital had amassed a $405,000 deficit.
"February was not a good month for us," said Bill Fenske, chief financial officer.
Even though patient volume and revenue met budget projections, the hospital lost $312,000 during February alone, mostly due to how it was reimbursed from third-party payers, Fenske said.
"What we found out is we had a real shift in our payer mix."
Preliminary financial statements for March look significantly better, however, he said.
"We're very pleased that we had a good month there. We will hit our targets," he said.
Revenue during the first 10 days of April also has been ahead of projections, Fenske said.
Still, hospital officials are scrutinizing their expenses and have asked department heads to each come up with a list of proposed spending reductions of 4 percent.