Arkansas - Digital Publishing

12 January 28, 2013 Arkansas Business
UAMS: Looks
to cut costs,
raise revenue
or both
Continued From Page One
A decrease in net state revenue.
“The trends that we’re seeing
are the increased costs associated
with uninsured care,”
Rahn said. “We’re going to have
to seek new revenue streams,
reduce expenses or both.”
For the fiscal year that ended
June 30, the UAMS campus
reported an operating loss of
$63.3 million and a net loss of
$7.9 million, even after state
appropriations, gifts and investment
income. That compared
with an operating loss of $29.4
million and net income of $42.23
million the previous year.
Most of the loss in fiscal 2012,
though, was tied to an accounting
charge involving the booking
of sick leave benefits to
UAMS employees.
“There were a number of
SPOTLIGHT: The Future of Health Care in Arkansas
The average number of visits per month to UAMS’ ER has jumped from 4,500
in fiscal 2011 to more than 5,000 this fiscal year. [PHOTO BY MICHAEL PIRNIQUE]
things that worked against us,”
Rahn said of fiscal 2012.
UAMS’ hospital alone reported
a loss of $568,712 on total
patient revenue of $1.4 billion.
Through the first six months
of the current fiscal year,
UAMS’ hospital is “fundamentally
breaking even,” Rahn
said. He declined to say what
the numbers were because he
hasn’t yet presented them to the
University of Arkansas Board of
Trustees.
“But breaking even is not
good enough,” he said. “We’re
kind of operating on the edge.”
He said UAMS needs prof-
2013 Arkansas Business Hall of Fame
its from the hospital to support
its mission of improving health
and health care in the state.
Rahn is banking on a number
of cost-saving moves and
increases in revenue that will
help the UAMS campus, including
forming a partnership with
St. Vincent Health System that
could save both systems money.
Under national health care
reform, hospitals and doctors
will have to demonstrate lower
costs while providing highquality
care, which will be key
metrics in governmental and
commercial reimbursements.
“We’re really beginning the
process here that’s the first
real fundamental redesign of
health care since Medicare and
Medicaid came into existence
46 years ago,” Rahn said.
Health Care Reform
One of the top issues Rahn is
supporting is the expansion of
Medicaid for the working poor,
which will add about 250,000
Arkansans to the joint federalstate
program.
Approving the expansion
will require a 75 percent supermajority
vote in both the
Arkansas House and Senate.
“We’ve got to get everybody
into the [insurance] system,”
Rahn said. “We have an unsustainable
volume of uninsured
care.”
House Public Health Committee
Chairman Rep. John
Burris, R-Harrison, told Ar-
kansas Business last week many
unanswered questions remain
surrounding Medicaid expansion,
including what kind of
latitude the state will have in
implementing the expansion.
“Right now it doesn’t look
like we’ve got a lot of flexibility,
and I think that makes the decision
more difficult,” Burris said.
In 2009, we had to make a decision. Our IT
needs were being evaluated and we wanted to
explore our options. We were recommended to
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cost that didn’t break our budget. We were told
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been able to provide us with a level of service
higher than anticipated at a fraction of our
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It is clear that we have made the right decision.
A vote might come in February,
he said. Failure to approve
the expansion, whose
cost will be covered by the federal
government for three years
starting in 2014, would be a
financial blow to UAMS Medical
Center and other hospitals
around the state, hospital officials
have said.
In fiscal 2012, charity care
and bad debt for the entire
UAMS campus rose 15.2 percent
to $202.1 million.
The percentage of UAMS
patients who don’t have insurance
is about 12 percent.
Meanwhile, UAMS is seeing
more patients in its emergency
room. The average number of
visits per month has jumped
from 4,500 in fiscal 2011 to 4,750
in fiscal 2012 to more than 5,000
in the first half of fiscal 2013,
Rahn said.
“It’s critically important to
the future of the health system
and the health of the population”
that Medicaid be expanded,
Rahn said.
It is unclear what impact
health care reform, which will
require people to have health
insurance by Jan. 1 or face a
penalty, will have on UAMS.
Rahn said he doesn’t know
Joshua Clausen
Maumelle City Clerk / City of Maumelle
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