Alice Hyde Reports First Quarter Loss Amid Low Patient Volumes
Despite a better-than-expected close to its 2020 Fiscal year (FY20) and millions of dollars in federal stimulus funds largely defraying the financial impact of the COVID-19 pandemic last year, UVM Health Network – Alice Hyde Medical Center is still feeling significant negative effects from the public health crisis.
The hospital reported today that it lost more than $2.4 million through the first three months of its 2021 fiscal year (FY21), as the COVID-19 pandemic continued to depress patient volumes for outpatient medical care and procedures.
The operating loss of $2.425 million through December 31, 2020 was offset somewhat by the hospital bringing a little more than $1 million in CARES Act stimulus funding onto its books over the same three-month time period, bringing Alice Hyde’s net operating loss for the period of Oct. 1 through Dec. 31 to $1.365 million.
Christopher Hickey, Chief Financial Officer for both Alice Hyde and UVM Health Network – CVPH, said the first quarter loss was driven entirely by patient volumes that continue to lag far behind pre-COVID levels. Through Dec. 31 the hospital reported lower-than expected volumes for adult and pediatric discharges (-39.5 percent); births (-41%); outpatient surgeries (-39%); gastroenterology patient visits (-59.8%); and outpatient clinic visits (-18.8%).
“Our challenge is completely volume driven at this time,” said Hickey. “Over the summer and beginning of fall last year, we were starting to see the return of volumes to normal levels. However, the reemergence of COVID-19 completely reversed that trend.”
While Alice Hyde has been able to trim a significant amount of expenses – more than $1.26 million in savings -- mostly through leaving open positions unfilled, Hickey said the organization would need to continue finding ways to reduce operating expenses and align with lower patient volumes.
“We are in a position of having to continue to challenge everything about the way we operated before COVID,” said Hickey.
Alice Hyde President Michelle LeBeau said that the pandemic’s mounting financial impacts continue to put the hospital in an unsustainable financial position.
“The unknown in front of every hospital is whether or not patients will return to us in the ways we were accustomed to before COVID,” said LeBeau. “That’s a question we can’t answer, so we must focus on the things we can control: operational improvements, managing expenses, and aligning our resources with our community’s needs as they are right now. The past year is proof that Alice Hyde has remained true to our mission despite the pandemic’s challenges. That’s a commitment we will continue to keep, even as we search for ways to place our organization on a sustainable path forward.”
The hospital’s substantial financial loss through the first quarter of FY21 represents a second dramatic shift in its financial position since late last year, when it ended its 2020 fiscal year in a better-than-expected position following a year-end audit.
In November Alice Hyde reported that it expected to end FY20 with an operating deficit of $1.4 million, posting revenues of $95.3 million and expenses of $96.7 million. The hospital’s revenue for FY20 included more than $10 million in federal stimulus dollars through the CARES Act.
The hospital’s FY20 projection was based on a variety of factors, including revenue collection rates of 34.4%. The year-end audit found that the hospital’s collection rate was actually 35% -- a revision that resulted in a $1.4 million increase in revenue for FY20, meaning that the hospital ultimately reported a break-even budget for FY20.
“That’s a tremendous achievement given the challenges presented by the pandemic,” said LeBeau, “and it’s due to the hard work and dedication of every member of the Alice Hyde family. Like many health care organizations, despite that great result, 2021 continues to present significant challenges to our organization, and we must continue to focus on finding ways to respond and lead the conversation about the future of health care in our region.”