The Mountain Communities Healthcare District Board of Directors approved an $18 million operating budget for 2020.
The budget includes $8.5 million for salaries, $1.9 million for benefits, $2.9 million for professional fees, and other costs that bring expenses to $18.2 million.
It projects approximately $15.1 million in operating revenues from patient services and $3 million in supplemental funds. At year’s end an increase in net position of $5,810 is projected.
MCHD Chief Financial Officer Jennifer Van Matre said the numbers are conservative as she waits to find out about certain changes in government programs.
The bulk of the non-operating revenue comes to the district via the Intergovernmental Transfer Program which supplements low Medicare reimbursement.
“The supplemental funding is basically paying for services rendered and bringing us whole,” Van Matre said.
Due to improved finances, the district directors opted not to send out tax bills for this year, so the 2020 budget doesn’t include parcel tax income.
The MCHD board approved the 2020 budget during its Dec. 30 regular meeting. Also shared were financial reports for 11 months of 2019, from January through November. At that point 2019 was showing an increase in net position of $2.7 million.
“We were really busy,” MCHD CEO Aaron Rogers said.
Rogers noted that the district received payments for meeting state goals pertaining to Medi-Cal patients such as preventative screenings for colon cancer and women’s health. Not just Medi-Cal patients but “everybody benefited,” from those programs, he said.
With improved finances the district has been able to negotiate with competing companies for better contracts, Rogers added.
At the end of November, the district had enough cash for 150 days of operations, up from 72 days at the end of 2018.
“Always, my goal is 180 days,” Rogers said, but he noted that cash will dip in 2020 because of several major capital improvement projects.
One big project will be conversion to a new healthcare electronic records system. The district got federal funding to implement a mandated electronic healthcare system in 2012. However, the company that provided that has not maintained federal certification, Rogers said. “It’s a federal requirement,” he added.
Many companies that got into the electronic health records market have left it after the incentive payments for putting in the systems phased out, Rogers said.
CFO Van Matre estimates the electronic healthcare records conversion will cost $1.5 million. Other pending projects this year include a new boiler for about $1 million and a radiology equipment upgrade anticipated to cost $500,000.
The 2020 budget includes costs and revenues from the expansion of the Trinity Community Health Clinic expected to open this year. Rogers said the budget is conservative in only counting six months’ worth of income from the expansion.
“I expect it to be open in the next month or two,” Rogers said.
Other factors in the 2020 budget include a 1.09 percent price increase for services. The budget also includes a wage increase of 4 percent across-the-board following last year’s 3 percent increase.
According to background materials for the board, the increase reflects the continued financial improvements the district has achieved in the past few years and is expected to aid in keeping and recruiting staff.