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2003-Q3 |
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About Fletcher Allen > Financial Information > 2003-Q3 |
Immediate (August 5, 2003)
Mike Noble
Fletcher Allen Public Affairs
802-847-2886
Fletcher Allen Releases Third Quarter Financial Results
BURLINGTON, Vt. -- Fletcher Allen has released financial results for the third quarter (April-June) of fiscal year 2003. The institution began making its quarterly financials public with the release of the first quarter results for this fiscal year.
Net loss from operations was $2.3 million in the quarter. While the financial performance fell below budget for the third straight quarter, a quarter-to-quarter comparison reflects an improvement in operating and net results. The operating margin was -3.7% for first quarter, improving to -2.6% in the second quarter and a further improvement to -1.8% in this most recent quarter.
"During the third quarter, we implemented a budget recovery plan to improve operational performance. Hard work on the part of people throughout the organization resulted in holding expenses to within 1% of budgeted levels for the quarter. The plan included a strengthened case management program, which improved the efficiency and delivery of care, further reducing costs. The plan also included expanded ancillary services to reduce patient backlogs. However, lower than expected patient volumes resulted in reduced revenues, negatively impacting our financial results," said Edwin I. Colodny, interim President and Chief Executive Officer.
Revenues were also impacted by a shift in the mix of payors to those with lower reimbursement rates such Medicaid and Medicare. Currently, approximately 70% of patient activity is covered by government and commercial plans that have fixed payment systems.
The quarter's operational loss was accompanied by below-budget results in non-operating income, which includes revenue from affiliates and investments. While below budget, the third quarter net income from all sources showed a gain of $126,414.
Key measures of volume for the quarter were mixed. Total inpatient discharges were below budget by 48 (0.8%), but were above last year by 448. Patient days (a measure of the number of patients in the hospital each day) were under budget by 2,850 days (8.6%), and under last year by 2,146. Physician office visits, while increasing in number by the end of the quarter, were under budget by 6.8%.
Through the first 9 months, net loss from operations totaled $10.7 million.
The budget recovery plan also included a goal of attaining an operating surplus from operations of $4 million. "We have seen improvement in several areas that significantly reduced the third quarter operating loss," Colodny stated. "However, the current year-end projection indicates that we will report a loss for FY 2003."
