Oak Valley Hospital officials received good news from auditors, TCA Partners LLP, at the completion of the audit for the hospital’s fiscal year ending June 30, 2011.
The hospital not only received the desired “unqualified audit opinion” but TCA Partner Jerrel Tucker added that “from an accounting standpoint, Oak Valley is a well managed hospital. Oak Valley is financially sound and stable and is constantly improving its procedures, especially in the way they manage financial patient services.”
TCA Partners, LLP, an accounting firm that specializes in auditing small and medium size hospitals, completed the audit of Oak Valley Hospital for the fiscal year ending June 30, 2011 and reported its findings to the District Board at its regular August meeting.
The official audit reported no material weaknesses or deficiencies related to internal controls. There were no audit adjustments and no disputes or disagreements with management during the course of the audit.
Tucker made a point of commending hospital officials for carefully segregating and accounting for bond money to be used exclusively for the current hospital construction project. He confirmed that no funds were co-mingled and that all costs were appropriately captured and in complete compliance with regulations.
According to Tucker, hospitals are continually being asked to maintain high quality patient services as state and federal funding sources shrink. “With margins becoming smaller, hospitals have to be constantly vigil to insure systems are in place to adequately bill and collect for patient care. Oak Valley does a very good job in recognizing and addressing this aspect of financial management,” Tucker added.
The hospital’s Governing Body also approved the operating budget for the new fiscal year beginning July 1, 2011. While the adopted budget of net revenue from operations is $65,728,000, a loss of $353,000 is forecast. While the loss may appear minor, the new budget anticipates significant financial growth in specific areas and reduced expenses in other areas and will require tight budget controls within every department. An increase in volumes is projected in the Emergency Department, Med/Surg, The Care Center and in the Health Care Clinics located in Oakdale, Riverbank and Escalon. The budget takes into account the fact portion of the new state-of-the-art hospital will open midway through the fiscal year, causing increases in both depreciation expenses and interest expenses.
Since labor expenses are a significant portion of any hospital operating budget, it is noteworthy that the new budget anticipates no reduction in workforce and no salary increases with the exception of an increase previously agreed to with the ambulance service. There will be a significant increase in employee health care benefits as a result of the national Healthcare Affordability Act. Those benefits include no lifetime maximum on medical benefits; elimination of annual limits for mental health and substance abuse treatment; elimination of annual limits on medications; and elimination of pre-existing conditions for dependents under the age of 19.
It’s also appropriate to acknowledge the management team’s ongoing efforts to utilize technology to streamline processes in order improve patient service levels and decrease non-labor expenses. We are all asked to do more with less in these economic times and our employees are committed to being both efficient and creative in meeting that challenge.
John Friel is the Chief Executive Officer for Oak Valley Hospital. Look for the Health Watch column as a regular feature each month in The Oakdale Leader and periodically in The Riverbank News and The Escalon Times.