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Health care: Hospital disputes state profit figures
By Jason Lesley
Waccamaw Community Hospital and Georgetown Memorial Hospital made a combined profit of more than $21 million last year, according to figures published online Wednesday by the state’s Department of Health and Human Services.
Waccamaw Community Hospital had total revenue of $140.2 million, and Georgetown Memorial Hospital had revenue of $119.2 million in fiscal 2013. Waccamaw’s profit over the past five years is $52.4 million, and Georgetown Memorial’s, $30.5 million, according to the state’s figures on schealthdata.org.
The big difference for Waccamaw Community Hospital in 2013 was profit on patient services: $7.6 million compared to a $1.5 million loss at Georgetown Memorial.
Only 11 of the state’s 60 hospitals listed in the report had a higher occupancy than Waccamaw Community Hospital’s rate of 65.9 percent. Waccamaw, with 167 beds, reported 40,164 occupied bed days with 3,714 of those charged to Medicaid, 25,848 charged to Medicare and 10,602 charged to others. Medicare patients accounted for 64 percent of Waccamaw’s occupancy rate, the report said.
Georgetown Memorial, with 131 beds, reported an occupancy rate of 38.5 percent with 18,394 occupied bed days. Medicaid paid for 4,460 of those; Medicare paid for 10,432 bed days and other providers paid for 3,502. Medicare patients accounted for 57 percent of the Georgetown Memorial occupancy rate.
“Unfortunately, the reported numbers are incomplete and, thus, inaccurate,” said Bruce Bailey, president and CEO of Georgetown Hospital System. Consider this example for our health system. The reported profit of $21 million for Waccamaw Community Hospital and Georgetown Memorial Hospital doesn’t include the significant operating losses we incur to subsidize money-losing but critically important community health services. When you include those losses, our system’s 2013 income from operations was $9.6 million, or less than half what’s reported. The accurate and complete number translates into an operating margin of just 3.6 percent.
“As a not-for-profit, community health system, our sole mission is to meet the health care needs of our community. Any income we make that is greater than our expenses is reinvested in our community through the acquisition of new technologies, the recruitment and retention of excellent physicians and the construction of modern facilities. By managing our organization efficiently and controlling costs, we are able to produce a positive margin that allows us to continue to invest in the health of our community.”
Thornton Kirby, president and CEO of the South Carolina Hospital Association, said the state’s hospitals support price transparency and continue to work with the Department of Health and Human Services to ensure the data are as accurate as possible. “A major concern is the agency’s use of unaudited and incomplete financial data that tend to distort profit levels for hospitals throughout the state,” Kirby said.
S.C. Health and Human Services director Tony Keck said the numbers don’t support hospitals’ arguments that rejecting $11 billion in federal Medicaid funds would hurt profit. South Carolina hospitals estimated a $2.6 billion cut in reimbursements under the Affordable Care Act.
“The reality is that financial statements which they provide to the federal government to drive a lot of their reimbursement tells us that hospitals have enjoyed another year of increased profitability,” Keck told reporters Wednesday.
The Medical University of South Carolina Hospital had the highest occupancy rate in South Carolina in 2013. Its beds were full more than 81 percent of the year. But the busiest hospitals weren’t the most profitable, and higher occupancy didn’t always yield higher profits. The Medical University Hospital made $28 million last year, about $10 million less than Patewood Memorial Hospital in Greenville, even though Patewood’s beds were occupied by inpatients less than 9 percent of the year, the lowest occupancy rate among all hospitals in the state. Seventeen hospitals on the list lost money during the 2013 fiscal year, most of them were located in rural communities.