The year 2004 was a difficult year for Baptist Health System (BHS) in Birmingham. The nine-hospital system recently reported a loss for the fiscal year of $50.8 million with total revenue of $803.8 million. That followed a loss of $8.3 million in 2003.
Despite the grim numbers, Beth O’Brien, CEO at BHS, is hopeful as the new fiscal year begins. “The first two months of the year have been encouraging,” she said. “The trend lines have been reversed.”
O’Brien said it is too early to make any conclusions about the year. Still, she said she is confident that 2005 will be a much better year than the one just completed.
“It is a whole new management team here now,” she noted. “The business discipline is quite heightened.” She expressed hope that savings from a new medical supply contract and staff layoffs will make a difference in the financial picture of the hospital as well.
Chief financial officer Doug Davenport pointed out that only $16 million of the loss was related to operations. The other $34 million resulted from investment losses including the difference between the value of Baptist Coosa Valley Hospital and what the system made from the sale of the Sylacauga facility.
Davenport said BHS has been able to pay all its expenses including capital improvements, during the first two months from operations. “We have not had to dip into reserves at all,” he added.
O’Brien acknowledged that the 2005 budget adopted by the board of directors has a built-in deficit but declined to say how much. “We are on a journey that will take us at least two years,” she said. “I do not want to predict a timetable. That would be premature but the signs are positive. We are containing cost and trying to grow income with new services.”
(TAB)
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