Carolinas HealthCare reduces 1Q loss - St. Louis Business Journal:

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Investment losses for the latest quarter totalednearly $101 million. Chied Financial Officer Greg Gombar anticipates gains in the financial markey in April and May will erassethose losses. Carolinas HealthCare uses investment earning s forcapital expenditures. That money is not used for dailyy operations. The health-care system hopes negotiations with several lenders will cut its interestr expenses tied to variable debt andhigher bank-liquidity Those fees are about $1 million per Interest expenses in the first quarter were $21.9 million.
From an operationao standpoint, Carolinas HealthCare had a strongfirst quarter, says Russ executive vice president for business development and Net operating revenue climbed 8.6 percent to $1.2 billion Operating income exceeded $24.5 The health-care system saw adjusted discharges a calculation that gauges patient activitg — climb 5.2 percent from a year Growth within the health-care system and expensde management “is the primary driver why we’re abovre budget significantly,” Guerin says. Carolinas HealthCare spent morethan $106 milliom on capital projects in the first quarter.
Projects includ new operating roomsat CMC-NorthEast and Carolinasz Medical Center, an expansion of CMC-Pineville, a new hospita l at CMC-Lincoln and construction of health-care pavilionss in Steele Creek and Waxhaw, whichn will include free-standing emergency departments. Challenges in the cominb months include managingthe system’s growing bad-debft and charity-care costs, reducingh interest expenses and preparing for a possible statse cut in Medicaid funding, Gombafr says. Bad-debt costs were 12 percent over budget durintg thefirst quarter, topping $48 million in the first During the same period last year, bad debt was abour $43 million.
The health-care system spent more than $770 million in community care in includingbad debt, charity care and subsidizinb Medicare and Medicaid. That equals 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 uninsured, how many peoplew show up at our door without North Carolina’s budget woes could results in a cut of up to 15 perceny for Medicaid. That could equate to $36 million in annuaol losses forCarolinas HealthCare. “Medicaid cuts are the worst economicx benefit cut the statecan make,” Gombar “It’s painful.
” Says Guerin: “It raises prices for thosw who do pay. It makes no good business sense to do Gombar says every dollar cut from Medicaidxeliminates $4 from the economy. Carolinas HealthCare is the largest health-care system in the Carolinas and the third-largest publicc system in the The system owns, leases or manages 25 It has more than 40,000 full - and part-time employees.