The Budget and Finance Committee of Erlanger's Board of Trustees on Monday night authorized the hospital's proposed $1.1 billion budget for fiscal year 2018-2019, sending it to the full board for a final vote at its upcoming Thursday meeting.
For the first time in Erlanger Health System's history, management is anticipating more than $1 billion in net revenue as well as a record-high $120 million in uncompensated care costs — products of Erlanger's expanding market share.
Board members spent the past month meeting with hospital executives and familiarizing themselves with the budget's details, which prioritize cost management and growth in admissions and revenue. Several factors projected to drive growth include a full year of operations at the new Erlanger Heart and Lung Institute, the opening of the new children's outpatient center in December, expansion at Erlanger East Hospital and the addition of Erlanger Murphy Medical Center in North Carolina.
Jim Sattler, who joined the board four months ago, said "there's a lot of moving parts" and "unknowns" for a large, expanding health system to consider in today's health care climate.
One area of concern is a $8.1 million cash requirement for the pension plan, and although Sattler said that area deserves attention, it's something the hospital has prepared for and budgeted.
"It's very important that we continue to have the profitability that we've got in order to continue," he said. "If we can achieve what we've got planned, and still be able to help the community to the tune of $120 million in indigent care, I think it's going to be a big plus."
Erlanger CEO Kevin Spiegel mentioned that drug prices are another factor that could affect the budget.
"There are a lot of new drugs out there that are going to make changes in patient care," he said, "and the ethical question is: How is this all going to be funded in the new health care system?"
Contact staff writer Elizabeth Fite at email@example.com or 423-757-6673.