ALPENA - The Alpena Regional Medical Center Finance Committee compared its new fiscal year budget to last year's July income statement, and while improvements were made in comparison to last year, overall expectations were not met. However, the committee remains positive about ARMC's finances, and will look to the next quarters to make further predications.
George Smart, vice president for finance and information systems, reported the income statement for the month, said operations generated excess revenue over expense in the amount of $74,386 compared to a planned excess of $387,434. With the addition of non-operating revenue, net excess revenue over expense amounted to $92,602.
"Revenue over expense is less than planned, but compared to last year we're doing better for the same month ... our cash flow is headed in the right direction," Smart said.
Gross patient service revenue for the month totaled $23,852,770, which resulted in an unfavorable variance of $3,792,633. Inpatient revenue also fell short of planned expectations by $1,504,855. Overall inpatient discharges met plan expectations, but the average length of stay was significantly below plan.
"A key contributing factor in the month of July was our Medicare case index of 1.25, normally this runs between 1.45 and 1.50. This means that our expected reimbursement per case was lower than average," Smart said.
Outpatient revenue also fell short of expectations, generating an unfavorable variance of $1,882,294 in gross revenue. Emergency room volumes increased due to seasonal demand, but surgical cases were down. Overall, professional service revenue fell short of plan by 18.3 percent for the month, with lower than anticipated demand.
"This is one month, the first month of our fiscal year. I'm not going to make any guesses to the rest of the next 11 months," Smart said. "We ended the month with excess revenue, last year at this time we has a small loss, so that's a plus."
The July 2012 financial reports were accepted by the committee and will be presented for board approval with operating fund disbursements amounting to $8,980,148 and R&I disbursements of $383,884 with write-off of uncollectible patient accounts amounting to $403,252 and recoveries of $100,205.
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Emily Siegmon can be reached via e-mail at email@example.com or by phone at 358-5687.