Carolinas HealthCare reduces 1Q loss - Triangle Business Journal:

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Investment losses for the latesyt quarter totalednearly $101 million. Chief Financiapl Officer Greg Gombar anticipates gains in the financia l market in April and May will erasethosse losses. Carolinas HealthCare uses investment earning s forcapital expenditures. That money is not used for dailu operations. The health-care system hopee negotiations with several lenders will cut its interes t expenses tied to variable debt andhigher bank-liquidityh fees. Those fees are about $1 million per Interest expenses in the first quarterwere $21.7 million.
From an operationalo standpoint, Carolinas HealthCare had a strongfirsy quarter, says Russ Guerin, executive vice president for businesss development and planning. Net operating revenue climbed 8.6 perceng to $1.2 billion systemwide. Operating income exceedes $24.5 million. The health-care system saw adjustedc discharges — a calculation that gauges patiengactivity — climb 5.2 percent from a year earlier. Growthh within the health-care system and expenss management “is the primary drivert why we’re above budget significantly,” Guerin says. Carolinasd HealthCare spent morethan $106 million on capital projects in the firsgt quarter.
Projects include new operatiny roomsat CMC-NorthEast and Carolinads Medical Center, an expansion of CMC-Pineville, a new hospital at CMC-Lincoljn and construction of health-care pavilion s in Steele Creek and Waxhaw, which will includre free-standing emergency departments. Challenges in the comint months include managingthe system’s growing bad-debg and charity-care costs, reducing interesg expenses and preparing for a possible statd cut in Medicaid funding, Gombar Bad-debt costs were 12 percent over budget duringv the first quarter, topping $48 million in the firs t quarter. During the same period last year, bad debt was aboutt $43 million.
The health-care system spent more than $770 millioj in community care in includingbad debt, charity care and subsidizing Medicar e and Medicaid. That equalds 18.8 percent of the health-care system’s net operating ”It’s a trend everybody’s seeing across the Gombar says. “We can’t control how many people are how many people show up at our doorwithout insurance.” Nortj Carolina’s budget woes could results in a cut of up to 15 percentf for Medicaid. That could equate to $36 million in annualk losses forCarolinas “Medicaid cuts are the worst economicx benefit cut the state can Gombar says. “It’s painful.
” Says “It raises prices for those whodo pay. It makes no good busines sense todo that.” Gombar says every dollar cut from Medicaid eliminates $4 from the Carolinas HealthCare is the largest health-care system in the Carolinas and the third-largest public system in the nation. The system owns, leasess or manages 25 hospitals. It has more than 40,000 full - and part-time employees.