Hospital Board Explains Loss of Seven Days Cash on Hand

Hospital Board Explains Loss of Seven Days Cash on Hand

The MHSC Board of Trustees unanimously voted to approve the FY2020 budget at its regular meeting this afternoon.

ROCK SPRINGS — A change in software programs by one of Memorial Hospital’s biggest payers resulted in the facility losing seven days of cash on hand in February.

Blue Cross/Blue Shield, which has been in the process of converting its software for about 18 months, has been manually entering claims and “it didn’t go so well,” according to hospital controller Jan Layne.

“They were having to manually submit all the claims, and so we were not receiving the funds very quickly,” Layne said.

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The days of cash on hand equates to the number of days that the hospital could operate if it didn’t generate any more revenue. Layne reported the hospital had 113 days of cash on hand at the end of February.

Ron Cheese, the hospital’s Patient Financial Services Director, said Blue Cross/Blue Shield went live with their new program at the beginning of February, and everything that normally processes automatically had to be done manually.

“At the end of February, Blue Cross of Wyoming owed just about $5,000,000. But since they couldn’t process things as quickly as they normally would, then what’s happening is in order to pay our $7.4 million in expenses and that kind of thing, we had to take from our reserves which reduced (the days of cash on hand).”
Ron Cheese, Patient Financial Services Director.

Cheese said the hospital received an $800,000 voucher from Blue Cross/Blue Shield yesterday but “when we sit here next month you’re going to see the same thing from Blue Cross because they haven’t got everything working yet.”

He added that at the end of March, Blue Cross/Blue Shield owed the hospital $3.6 million that should have been paid and would have prevented the hospital from dipping into its reserves again.

“And those monies will catch up, there’s just going to be a couple month’s lag,” Cheese said.

Hospital CEO Irene Richardson said the seven-day loss results in about $217,000 per day, or roughly $1.5 million for a week.

“Which is another way of saying that’s our average revenue expenditure pretty much,” said board chairman Richard Mathey.

The Numbers Breakdown

The year-to-date patient revenue at the end of February was $56,366,965 which is under budget by $1,474,070, according to Layne. Total expenses for February were $6,992,995, under budget by $213,241. Collections for February were $4,828,455.

“For the clinic the bottom line for February was a loss of $610,492 compared to a loss of $410,259 in the budget,” Layne continued. “The year-to-date operating loss is $3,611,442 compared to a loss of $3,583,253 in the budget.

Clinic Operations Director Leslie Taylor said she has two coders currently working on their certifications, but one coder has been out on maternity leave and the person who was going to fill in for her lost a family member.

“(CFO) Tammy (Love) and I discussed that I felt like my revenue would come in a little bit low because of that, so that’s part of what has happened,” Taylor said. She projects the March numbers to be much better now that the clinic is staffed better.

Layne also added the hospital is projecting to break even for March.