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Officials at Excela Health,
responding to the
Pennsylvania Health Care
Cost Containment Council’s
(PHC4) Annual Report on the
Financial Health of
Pennsylvania Hospitals,
expressed confidence in the
continued financial recovery
of Frick, Latrobe Area and
Westmoreland Regional
Hospitals. At the same time,
however, Excela Health
cautioned that financial
progress made in stabilizing
its institutions over the
past year could be
jeopardized if the proposed
cuts of $380 million to the
state’s Medicaid budget are
approved.
The PHC4 2004 Financial
Analysis report profiles the
financial health of
Pennsylvania’s 182 general
acute care hospitals. The
report focuses primarily on
the fiscal year ending June
30, 2004, but includes a
three year trend analysis.
At Excela Health (although
its hospitals were not yet
merged during fiscal year
2004), Westmoreland Regional
Hospital recorded a positive
operating margin in 2004 and
also reflected a positive
three-year average total
margin from fiscal years
2002 through 2004. Latrobe
Area Hospital, also
recording a positive
three-year average total
margin during the same three
years, incurred an operating
loss in fiscal year 2004 due
primarily to an increase in
pension expense and loss on
debt extinguishment. Frick
Hospital in Mount Pleasant,
although posting a negative
three-year average total
margin, managed to reduce
its operating loss by over
50 percent in fiscal year
2004 from the year previous.
“There has been great
progress here,” noted David
S. Gallatin, Chief Executive
Officer of Excela Health.
“We believe the financial
decline is over and are
confident that continued
growth in services to better
meet medical need will
ensure the long-term
viability of these community
assets. Our prognosis for
financial stability is
strengthened by our recent
merger whereby we can
continue to eliminate
duplicate services and
attract high-caliber
physicians to join our
growing health care team and
expanded portfolio of
services,” he added.
Administrators at Excela
Health were quick to add,
however, that the proposed
cuts in the state budget to
the Medicaid program will
hurt patients, hospitals and
communities and impinge upon
the financial turnaround
seen at Excela Health in
fiscal year 2004. Proposed
restrictions on Medicaid
benefits will hurt the
elderly, disabled and
chronically ill in the
community. These patients
may delay care, become
sicker and seek care in
emergency rooms - increasing
hospital uncompensated care
and raising health care
costs. Excela Health
officials will join with
fellow hospitals and The
Hospital Association of
Pennsylvania in Harrisburg
May 10 for Medicaid Advocacy
Day as a way to demonstrate
hospital / health system
unity on the message of
restoring the proposed cuts
to Medicaid.
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