Alameda Health System FY20 Budget Update
FY 20 Budget Principles and Process Budget Principles: • Develop a balanced budget that enables AHS to provide the highest quality of services for the population of Alameda County, while fueling AHS’s journey to population health and addressing community need. • Budget is reflective and supportive of FY2020 AHS Operational plan developed with input and feedback from staff and clinicians. Budget Process: • Budget baseline volume model takes a regression analysis of prior year actual historical trends and adjusts based on qualitative input from department leaders. • Inclusive of all areas of AHS and involves input from physician leadership (Dyad) and operational leaders. • The Budget Oversight Committee is the vehicle by which justified adjustments are reviewed. 2
FY20 Budget Process - Timeline Jan -Feb 8: Internal volume projections, discussions (with dyad leaders and staff) and review of key budget assumptions. Feb 14: Present Proposed Budget process and timeline to AHS Finance committee Feb 19-Mar 8: Internal Budget preparation and deep dive with departments March 11-15: Half Day Leadership retreat of key AHS Staff and clinical leaders to finalize AHS FY20 Operational Plan. March 14: Present Key Revenue assumptions and forecast to AHS Finance Committee Mar 15-April 15: Internal Budget gap discussions with Dyad Leaders, SBUs and support services April 26: Present Budget draft (Budget workshop- deep dive) AHS BOT retreat May 9: Final Budget to AHS Finance Committee May 28: FY 2020 AHS budget for approval to AHS Board 3
Budget Patient Volume - Acute ACTUAL2018 ACTUAL2019 BUDGET2020 ACUTE PATIENT DAYS 77,317 79,904 83,056 DISCHARGES 15,310 15,094 15,696 Average Daily Census 211.8 218.9 226.9 Average Length of Stay 5.1 5.3 5.3 Occupancy 84% 87% 91% SURGERIES 9,130 9,013 8,870 EMERGENCY VISITS 107,859 107,425 110,438 DELIVERIES 1,348 1,358 1,323 CLINIC VISTS 3,646 3,594 3,713 HGH Case Mix 1.444 1.473 1.473 AHD Case Mix (Incl PB/SS) 1.370 1.350 1.350 SLH Case Mix 1.713 1.690 1.690 4
Budget Volume – Post-Acute ACTUAL2018 ACTUAL2019 BUDGET2020 POST ACUTE PATIENT DAYS 107,904 110,806 110,202 DISCHARGES 779 914 836 Average Daily Census 295.6 303.6 301.1 Average Length of Stay 138.5 121.2 131.8 Occupancy 94% 96% 96% REHAB CLINIC VISITS 68 134 132 FMT Case Mix Index 1.113 1.131 1.131 5
Budget Volume – Behavioral Health ACTUAL2018 ACTUAL2019 BUDGET2020 BEHAVIORAL HEALTH PATIENT DAYS 24,158 24,932 24,639 DISCHARGES 2,938 2,763 2,903 Average Daily Census 66.2 68.3 67.3 Average Length of Stay 8.2 9.0 8.5 Occupancy 96% 99% 98% EMERGENCY VISITS 13,387 14,134 13,786 CLINIC VISITS 20,682 19,971 18,684 JGP Case Mix Index 1.075 1.126 1.126 6
Budget Volume – Ambulatory Services ACTUAL2018 ACTUAL2019 BUDGET2020 AMBULATORY SBU CLINIC VISITS PRIMARY CARE 160,785 188,247 189,138 SPECIALTY CARE 135,198 124,798 127,168 Total Visits 295,983 313,045 316,306 7
Preliminary FY20 Budget LineDescription ACTUAL2018 BUDGET2019 PROJ2019_N BUDGET2020 REVENUES ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ Total IP Charges 1,924,890,976 1,955,988,146 2,000,862,029 2,032,549,631 Total OP Charges 1,082,784,986 1,111,800,144 1,101,476,380 1,121,155,031 Total MD Charges 294,840,846 315,683,714 333,908,541 338,133,622 Total Gross Patient Charges 3,302,516,808 3,383,472,004 3,436,246,950 3,491,838,284 Capitation Revenue 33,677,851 33,633,811 38,224,675 38,835,803 Contractual Allowances 2,702,125,727 2,754,769,985 2,842,758,222 2,888,975,294 Total Net Patient Revenue 634,068,931 662,335,830 631,713,403 641,698,793 Other Revenues 374,127,765 396,029,106 402,466,697 366,444,784 Total Revenue ‐ All Sources 1,008,196,696 1,058,364,936 1,034,180,100 1,008,143,577 EXPENSES ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ Total Labor Expenses 685,855,234 708,418,015 687,689,233 775,327,646 Non‐Labor Expenses 323,340,366 318,026,197 310,668,586 330,780,995 Excluding 3 DEMO CC Total Operating Expenses 1,009,195,600 1,026,444,212 998,357,819 1,096,412,726 Operating Income (998,904) 31,920,723 35,822,281 (88,269,149) GASB 68 (20,417,602) (49,789,992) (37,281,000) (36,776,311) Interest Expense () (1,821,085) (914,813) (1,865,170) (1,865,170) Interest Income 928,631 560,212 1,202,170 730,977 Capital Cost Transfer (4,419,000) Non‐Operating Income 336,998 316,545 285,000 (7,305,548) Total Income (21,971,961) (17,907,325) (6,255,719) (143,181,115) Operating Margin ‐0.1% 3.0% 3.5% ‐8.8% EBIDA 1.6% 4.6% 4.5% ‐7.1% Labor Cost % of Total Revenue 68.0% 66.9% 66.5% 76.9% Benefits % of Salaries, Wages, OT 35.2% 35.6% 35.3% 34.4% EBIDA Margin @ 2.8% Goal 28,228,020 EBIDA Margin @ Current (71,354,193) Gap from EBIDA Goal (99,582,213) Proposed budget Target Reduction 86,178,858 EBIDA if target reduction achieve 14,824,665 EBIDA % if target reduction achieved. 1.47% 8
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