Pagosa Springs Medical Center sees ‘significant loss’ in revenue due to COVID-19

By Randi Pierce
Staff Writer

Following a strong start to the year, Pagosa Springs Medical Center (PSMC) suffered a “significant loss” in revenue in March due to the COVID-19 pandemic, according to a report given to the district’s board of directors on April 28.

At the end of February, PSMC was 12.14 percent ahead of budget and 18.73 percent ahead of the prior year with gross revenues totaling $10,778,881, and was 12.26 percent above budget and 17.74 percent ahead of the prior year in net patient revenues, according to a February financial report for the district given in March.

At the end of the first two months, PSMC’s bottom line was $45,715 -— above the budgeted deficit of $175,000 and the prior year’s deficit of $555,767.

“February was an excellent income month for PSMC (its best February ever). All of this is good because like most businesses, the pandemic presents new financial challenges for PSMC,” a March written report states. 

“We started out with a bang,” Chief Finance Officer Chelle Keplinger told the Upper San Juan Health Service District Board of Directors, which oversees PSMC, on April 28.

PSMC did not fare as well in March.

According to the March financial report present on April 28, PSMC’s gross revenue for March fell 14.57 percent, or $775,581, below budget and 6.78 below the prior year, while its net patient revenue fell 20.67 percent, or $575,718, below budget and 15.04 percent below the prior year.

Year to day through March, PSMC’s net patient revenue sits $21,598 ahead of budget.

“PSMC has, like many businesses throughout the country, suffered a significant loss of revenues in March PSMC was never required to stop doing nonemergency surgeries, but decided on March 18th to stop such surgeries to assure preparedness to treat the community during the pandemic,” a financial report prepared for the board states. “Due to substantial reduction in surgeries and in-person visits to patients in the clinic and emergency department resulted in PSMC’s revenues being below budget by $775,581. While PSMC was able to reduce and cut many expenses, due to the need for additional drugs and supplies to be prepared for COVID-19, the supply budget was 34% ($125,099) higher than budget. The bottom line result in March is PSMC … came in $743,719.00 below its budget (March was a total net loss of <-$199,217>).”

“I’m heartbroken,” Keplinger said, noting she was convinced this was going to be PSMC’s best year.

Despite the loss for the month, Keplinger noted the district had a good tax revenue month, with the district receiving $384,580.

Board chair Greg Schulte acknowledged April won’t look good and stated, “There’s really a lot of uncertainty because there’s a lot of things going on from the federal stimulus that, for lack of a better term, that we don’t know what and how much and whether it’s gonna be useful to us long-term, so I guess certainly we know that we’re having some difficulties, but there might be something that might help improve our position that comes down from the feds, but that certainly remains to be seen. And I think there’s a lot of uncertainty about that, not only with us, but with a lot of people, and so I’d like to, you know, give credit to the staff for following this really carefully.”

He added things are in flux and there isn’t clarity on how funds would be administered, what funds PSMC could take advantage of, or if it would want to.

Keplinger briefly commented on some of the possible funding programs, also acknowledging the uncertainty.

Director King Campbell commended PSMC on being ahead of budget before COVID-19 set in, noting PSMC was on a good path.

 

This story was posted on May 13, 2020.