Becker's Hospital Review

18 CFO / FINANCE California Hospital Files for Bankruptcy After Missing Payroll By Ayla Ellison T ulare (Calif.) Regional Medical Cen- ter, a 112-bed hospital managed by Tulare-based HealthCare Conglom- erate Associates, filed for Chapter 9 bank- ruptcy Sept. 30. e hospital filed for bankruptcy a few days aer HCCA, which is paid by the local hospi- tal district, said it was done footing the hos- pital's bills. "HCCA provided substantial re- volving funding to the hospital over the years, to a cumulative total of $14 million," Benny Benzeevi, MD, chairman and CEO of HCCA, said at a board meeting Sept. 28, according to the Valley Voice. "But in light of the current destructive political environment, HCCA will not continue to do so." Tensions have flared between HCCA and the hospital district's board since last year, and that battle is partially to blame for a recent credit rating downgrade by Fitch Ratings. On Sept. 29, less than 24 hours aer Dr. Ben- zeevi declared HCCA would no longer pro- vide financial support for the hospital, several nurses and other staff walked off the job aer not being paid. HCCA said a cash shortage by the hospital district was the reason it was unable to fund the entire payroll. Tulare Regional Medical Center's bankruptcy petition revealed the hospital has zero cash in its bank accounts. e cash shortage poses a risk to public health and safety, as the hospi- tal does not have the funds to purchase ade- quate medical supplies and "critical vendors" have discontinued service to the hospital due to lack of payment, according to bankruptcy documents. Chapter 9 bankruptcy is a bankruptcy pro- ceeding that offers distressed municipalities protection from creditors while a repayment plan is negotiated. n Tennessee Hospital Closes After Falling 94% Short of GoFundMe Goal By Ayla Ellison C opper Basin Medical Center, a critical access hospital in Copperhill, Tenn., closed Oct. 1. Copper Basin Medical Center has been in a dire financial situation for months. The hos- pital suspended inpatient services May 9 and laid off more than 15 nurses, according to WRCB. Officials launched a GoFundMe page earlier in 2017 to help keep the hospital afloat. They hoped to raise $100,000 through the cam- paign but fell about 94 percent short of their goal. As of Oct. 2, the hospital had received donations from 77 people, totaling $5,559. Copper Basin Medical Center is behind on its payroll, meaning some workers will be wait- ing for paychecks after they are laid off, hos- pital CEO Dan Johnson told WTVC. Regarding the closure, Mr. Johnson told WTVC, "We're a small, rural hospital and it's hard for us to adapt with all the changes in healthcare. We had no choice." n Geisinger's Operating Income Tumbles 34% By Ayla Ellison D anville, Pa.-based Geisinger recorded an operating surplus of $109.6 million in the fiscal year that ended June 30, down 34.6 percent from an operating surplus of $167.5 million in the year prior, according to recently released bondholder documents. Geisinger's revenues climbed 14.3 percent year over year to $6.3 bil- lion in fiscal year 2017. The growth was primarily due to a 13.9 per- cent increase in patient service revenue and a 15.8 percent increase in premium revenue. Geisinger's health plan membership climbed 5.8 percent year over year. The system's expenses also grew in the most recent fiscal year. Geising- er's expenses totaled $6.2 billion in the most recent fiscal year, com- pared to expenses of $5.5 billion in the year prior. "We view fiscal 2017 as a successful year for Geisinger," Kevin Bren- nan, executive vice president and CFO of Geisinger, said in a statement to Becker's Hospital Review. In addition to the growth in patient and premium revenues, Mr. Brennan said the system completed a success- ful $587 million bond offering in May and ended fiscal year 2017 with 242 days cash on hand. "Fiscal 2017's operating income reduction in comparison to the pre- vious year reflects significant investments in operational improvement planning and the implementation of revenue growth and expense efficiency initiatives," said Mr. Brennan. "Aside from launching innova- tive care redesign initiatives intended to ensure Geisinger's long term success, we also successfully integrated the Geisinger Commonwealth School of Medicine (formerly The Commonwealth Medical College)." Geisinger ended fiscal year 2017 with a net surplus of $444.5 million, compared to a net surplus of $667.3 million in fiscal year 2016. n

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