Wayne Allen, CFO

I am very pleased to announce that Wayne Allen has accepted the position of Chief Financial Officer for Mendocino Coast District Hospital, replacing Bob Anderson.  Wayne is one of the best CFOs that I have ever had the pleasure to work with and I am could not be happier that he has chosen to come back to MCDH.  He was our CFO  from 2006 to 2008, during a period when MCDH converted to critical access hospital designation and achieved an impressive financial turnaround.    For the past 2 years Wayne served as the Chief Financial Officer for Northern Hawaii Community Hospital on the Big Island of Hawaii.  That hospital, too, thrived under his leadership.   With National Health Care Reform, the California budget crisis and our current economy, it is a difficult financial time for hospitals, including Mendocino Coast Hospital.  We are extremely fortunate to have Wayne Allen back on our leadership team.  Welcome home Wayne!

MCDH Chief Financial Officer Bob Anderson

At last Thursday’s MCDH Board of Directors meeting, the Financial report for the month of December 2010 and the first 6 months of fiscal year 2010-2011 was announced to the Board and the public.  For the month of December, we reported a positive net revenue from operations of $217,687 and a positive net income from all sources of $305,926.  This is the highest single month for positive net revenue since June of 2009 and the highest month for positive net income since May of 2009.  These results are due to high volume for inpatient, outpatient and surgical services at MCDH for the month of December.   Although our inpatient census tracked very close to budget for the month, we had a higher percentage of acute and critical care patient days this month and a lower percentage of swing days, which resulted in high inpatient gross revenue.  It also helped that other revenue categories in outpatient, North Coast Family Health Center and Home Health all exceeded our budget as well this month.   It was good to see our outpatient services (those provided by our laboratory, diagnostic imaging, physical therapy, etc) grow this month. 

Just as important, as high revenues was the fact that our management team and staff managed to stay within budget on the expense side too.   For the month of December, we were within $3,000 of our budget target on a nearly $4,000,000 expense budget.   That is outstanding expense control.   In fact, our staff has kept expenses in check for the first 6 months of fiscal year 2010-2011 and as a result MCDH has a bottom line positive net income of $311,671 for those 6 months.     That puts us $220,000 ahead of budget so far this year. 

Although this is a very encouraging start for the current fiscal year, we all understand that this is a difficult economic environment that we are all living in.  We cannot count on this type of performance every month.   It is important for us at MCDH that we continue to do the things that grow our revenues, which includes offering the services that our community needs and by doing our very best to provide high quality services in a warm, welcoming environment that helps to make our patients and our guests feel comfortable and happy that they chose Mendocino Coast District Hospital.    It is also important that we continue to exercise expense control and to provide our services efficiently while not sacrificing quality or access.   I would like to thank our friends and supporters on the Mendocino Coast who are continuing to support us and to help us to continue to impove.

According to a recent California Hospital Association report, nearly 40% of all California hospitals are experiencing a bottom line loss (which puts us in the top 60% of hospitals in the State).  And we are not alone when it comes to struggles from operating income.  The average operating income for all California hospitals is a negative 0.5%.  Beginning on July 1, 2010 we  started a new fiscal year at MCDH.  This year we are going to be under more pressure than ever before to perform.  We have had to make some difficult choices and there are very likely to be more difficult choices ahead.  For example, for the first time in 4 years we chose to raise our prices this year.   Our prices are being raised 6% on average.  However, we are not raising our prices in all areas.  It is important that we continue to be the “hospital of choice” for the Mendocino Coast.   So, in some areas where we have historically been high, we are actually decreasing our charges.   We have also had to reduce expenses in some areas where it will not affect patient care.  There will be more difficult choices to face in the months ahead. 

I am thinking positively, however.  Our patient volume and our revenues have risen in the past 6 months.  We will be opening a new “state of the art” Diagnostic Imaging Center in January of 2011.  The new center should help us to regain some business that has been lost over the years.  Most importantly, we have a first class medical staff, nursing staff, clinical staff and support staff here.  I am very confident that we will make the necessary adjustments and in the end, we will be stronger than we have ever been before.  Thank you all for your continued support of our hospital!