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Another positive month for ARMC finances

October 20, 2010
Crystal Nelson

Preliminary financial numbers for the month of September show another operating gain for Alpena Regional Medical Center. The hospital's finance committee learned ARMC had a net income of $692,007 compared to a budgeted loss of $29,512 during its meeting Wednesday morning.

Chief Financial Officer George Smart said three areas that increased in volume were inpatient surgeries, the percentage of patients in the emergency room and cardiac diagnostic procedures.

"Comparing it to the same point in time last year, inpatient volume is up slightly but our length of stay is down," he said, adding from a reimbursement standpoint, it has a positive variance - a favorable financial outcome - for the hospital.

Smart said ARMC has the capacity for more inpatient volume as it's still 5-6 percent under the hospital's projected budget. Outpatient and professional service revenue also exceeded the hospital's goal and compared to the same time period a year ago, it is running near budget expectations.

The hospital's operating expense for the month generated a positive variance of $249,561, the expense of supplies was under budget by $163,134, or 15 percent, and a balance sheet approach is being used to formulate bad debt expense while offsetting recoveries against this expense.

The finance committee recommends the board accept the September financial reports as presented and approve operating fund disbursements amounting to a little over $10 million, R&I fund disbursements amounting to $51,570 and the write off of uncollectable patient accounts amounting to $298,344 with recoveries amounting to $22,229. September marks the end of first quarter of the hospital's fiscal year.

The finance committee also recommends the purchase of a telephone/voicemail upgrade and software from Nortel in the amount of $53,649. Chief Executive Officer Karmon Bjella said the hospital originally had budgeted $30,000 for the voicemail but it was advised to spend $23,000 to upgrade the software that supports it.

Crystal Nelson can be reached via e-mail at or by phone at 358-5693.



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