Greenville Hospital Systems 2010 Budget

GREENVILLE, S.C. – The board of trustees of the Greenville Hospital System University Medical Center (GHS) on Tuesday approved a nearly $1.4 billion total operating revenue budget for fiscal year 2010. The budget, which begins Oct. 1, increased 12 percent over 2009’s $1.2 billion projection and reflects a 3 percent price increase.

Hospital officials said they tried to minimize the budget’s impact on patients and the community through careful planning and minimal price increases. The 3 percent increase is lower than national inflation rates and regional inflation rates for health care, said Susan Bichel, GHS vice president for financial services.

GHS’ budget does not include salary increases for employees. That applies to all employees, including physicians, senior leadership and the GHS CEO. The decision is consistent with trends in the healthcare industry in South Carolina and nationwide, said Greg Rusnak, GHS’ chief operating officer.

“Our budget goals were to expand primary care access and continue to improve quality, invest in clinical expertise in order to increase patient access to much-needed services, protect and grow jobs, and to minimize cost to the community while preserving our financial stability,” said Rusnak.

Bichel said the budget conservatively managed expenses through initiatives such as supply chain savings, strategic alliances and improved contracting through group purchasing.

Careful planning also means that GHS is able to move forward with its plan to hire approximately 460 new employees over the next 12 months. In FY 2009 alone, GHS will contribute approximately $550 million to the area economy in total payroll.

New positions include additional primary care physicians in underserved areas as well as more business and clinical support staff, information technology specialists and allied health-related positions. GHS has pledged to hire approximately 100 primary care doctors over three years to deal with an already existing local shortage and help protect the region against a projected national shortage. Some of those physicians will include doctors already practicing in the community. One of the most innovative new physician practices is MD360 Convenient Care, an extended-hours physician practice that will be open seven days a week. In addition, GHS has opened a Rapid Access Pediatric Clinic, an extended-hours pediatric practice that provides patients with an alternative to the emergency room.

Enhanced patient care quality and safety are the catalysts behind the information technology improvements such as the continued implementation of a system-wide electronic medical record (EMR) and clinical documentation initiative.

“In any budget planning cycle, businesses face the normal issues of tight budgets and resource allocation,” said Mike Riordan, GHS president and CEO. “What’s different this year is that we are also in an unusual economic climate that’s further complicated by a steadily changing and evolving healthcare environment. Despite all that, we have continued to proactively plan our continued future success and how best we can achieve our healthcare commitment to the community – regardless of the environment in which we find ourselves.”

“Now more than ever, we need to be good stewards of our resources through steady management and through innovative partnerships like our alliance with Palmetto Health and our ongoing academic medical alliances with the University of South Carolina, Clemson University, Greenville Tech and other university partners,” said Riordan.

Keeping GHS economically sound also means that it has the resources to recruit top clinical staff, including physicians, nurses and other specialists, to its hospitals and academic medical programs, as well as provide patients access to leading-edge technologies and advanced medical treatment.

Meanwhile, GHS – like other healthcare systems nationwide – continues to deal with charity and bad debt. Charity and bad debt, considered at cost, is budgeted for $88.2 million and $41.9 million in 2010, respectively. The projected figures for 2009 were $78.7 million in charity and $37.5 million in bad debt.

Labor costs, including salaries, benefits and contracted labor, are anticipated to grow 12 percent next year as a result of increases to staffing to support strategically important programs such as additional physician practices and expanded clinical programs. The supply expense is budgeted to grow $6.5 million next year with the major cost increases in surgical supplies, general supplies and pharmaceuticals.