PORT ANGELES — Olympic Medical Center’s various departments have requested $17 million from next year’s capital budget.
Management says it can approve about half that amount.
Eric Lewis, chief executive officer, told the six hospital commissioners on Wednesday that OMC is focused on upgrading the elevators at the Port Angeles hospital, upgrading medical equipment throughout the campus and implementing electronic medical records.
OMC received $714,000 in federal appropriations for electronic medical records.
An additional $5 million in federal stimulus money is available through 2015, but investments in electronic medical records must be made up front.
“We’re also working on an electronic medical records federal grant application,” Lewis said.
“We’re going to be asking for something over a million dollars to help us fund EMR.”
The hospital district will face some major challenges in next year’s budget, Lewis said.
Medicare challenges
The biggest challenges will be sagging Medicare and Medicaid reimbursement, pharmaceutical costs, uncompensated care and inflation, Lewis said in a wide-ranging administrator’s report.
OMC is preparing a budget and an updated strategic plan for 2010 to 2012.
The strategic plan will focus on health care reform, financial stewardship, improvement and expansion of the emergency department.
The board will consider approving a plan next month.
“Of course, we are going to spend a lot of time in the next month finalizing goals and language,” Lewis said.
The board will discuss the strategic plan at a retreat today from 8 a.m. to 1 p.m. at the hospital’s Seasons Cafe. No formal action will be taken.
Public hearings on the strategic plan are set for Nov. 3 at the Sequim Medical Services Building from 12:30 to 1:30 p.m., and on Nov. 4 in Linkletter Hall in the Port Angeles hospital from 6 to 7 p.m.
Five-star award
Meanwhile, for the sixth-straight year, Olympic Medical Center was recognized as a five-star community value provider by Ohio-based Cleverley and Associates, a leading health care financial consulting firm.
“It’s an award that we do not apply for,” assistant administrator Rhonda Curry told the board.
“We don’t seek it. It is strictly based on data.”
OMC finished in the top 20 percent out of 2,643 hospitals that were surveyed this year.
The award recognizes financial strength and reinvestment, cost of care and pricing.
“We are proud to receive this recognition year after year since we strive so hard to sustain relatively low health care charges while maintaining high quality care,” Lewis said in a prepared statement.
“We continue to place financial stewardship in very high regard.”
Julie Rukstad, OMC’s chief financial officer, brought more good news to the board with a solid third-quarter financial report.
OMC’s operating margin last quarter was is 4.8 percent. Operating margin is the “profit” that nonprofit organizations like OMC earn to pay for capital facilities and to upgrade or replace equipment.
The district’s operating margin had hovered between 1 percent and 2 percent in 2008.
It dipped further to 0.3 percent in the first quarter of 2009 before jumping to 5.9 percent in the second quarter.
“Total operating expenses are $31.25 million, which brought operating income to $1.57 million for the quarter, which is a really good quarter for us,” Rukstad said.
On budget
For the year to date, OMC’s operating revenue is on budget at $96.81 million. Operating expenses are 1 percent over budget at $92.19 million.
A $4.37 million net revenue is 6 percent under budget.
“It’s less than budget, but still a good a year-to-date number for us,” Rukstad said.
Lewis said OMC next year will upgrade signs and maps in the hospital.
“Signage in health care needs to be bigger letters, and we’ve really got to spend a lot of time thinking about where people will see it,” Lewis said.
“I think signage is not a strength of OMC now. We want to start with the hospital then move it out.”
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Reporter Rob Ollikainen can be reached at 360-417-3537 or at rob.ollikainen@peninsuladailynews.com
