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PMH is financially stable

City-owned hospital loses $1.3 million

Published: Wednesday, Aug. 20, 2014 2:39 p.m. CDT • Updated: Wednesday, Aug. 20, 2014 3:49 p.m. CDT

PRINCETON — Although Perry Memorial Hospital lost $1.3 million last year, the city-owned hospital remains financially stable.

That was the message the Princeton City Council heard at its meeting Monday from Rex Conger, PMH’s president and chief executive officer, and Mike Harrell, the hospital’s interim chief financial officer.

Conger said in the PMH’s annual report to the community, “The long-term, financial strength of the hospital has been retained because of good financial planning and a conservative approach to operations.”

Conger also indicated that the implementation of the Affordable Care Act at the same time the nation’s economy was still recovering from the “Great Recession” was a financial challenge for hospitals like PMH.

“Thankfully, Perry saw the problem coming and stopped further construction and renovation at the end of 2009,” added Conger. “For the last four years, we have been watching the changes take place and avoiding as much expense as possible. We have stopped providing services that had grown smaller, and that we could no longer financially support — with what we were being paid.”

He reported the closure of the hospital’s OB Department and Perry Home Medical as the largest impact of closures during the past fiscal year.

“Healthcare providers struggling in the current healthcare environment is not uncommon,” Conger said, citing the building of new hospitals in Kewanee and Mendota, which both had to later join a larger organization to survive.

Conger said PMH’s board of directors decided to pull money out of reserves when planning the budget for the new year to give its part of the economic recovery a jump start.

He cited adding two new full-time orthopedic surgeons, Dr. Frank Minardi and Dr. Boone Brackett, plus some benefit adjustment to assure the hospital retains its “great staff to provide the highest quality patient care and customer service.”

Conger also reported the transition of Princeton Family Physicians to become part of the hospital as Perry Memorial Family Health Clinic as a new opportunity for PMH to add other experienced nurse practitioners and physicians to support the medical needs of the area into the future.

He also reported the initiation of a hospitalist service at PMH would help the hospital draw younger physicians to Princeton. Hospitalists are doctors paid by the hospital to focus their attention on the patients they are taking care of in the hospital to allow other physicians in the community have a better “home/work” balance to their lives.

“While last year was a challenge, we believe that the changes and opportunities that Perry Memorial (Hospital) has put into place will help “your hospital” to continue to grow and adapt to the new environment that is being created for healthcare in our country,” said Conger.

Harrell said the hospital’s audit conducted by McGladrey shows PMH’s financial position remains strong at $36.4 million with a net loss of $1.3 million for the year ending April 30. Net patient service revenue decreased 7.4 percent while total operating expenses decreased 4.8 percent. The hospital’s total compensation related expenses were $18.2 million.

Perry Memorial Hospital’s recent financial picture shows the hospital lost $1 million three fiscal years ago, made $1.3 milllion two years ago, lost $700,000 last year and lost $1.3 million this year, Conger told commissioners.

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