UCSF STANFORD: Posts Unexpected $10 Million First-Quarter Loss
UCSF Stanford Health Care registered a $10.7 million operating loss that administrators say they plan to stem through "attrition" and "staff reductions." The San Francisco Chronicle reports that the loss, "which occurred during the first fiscal quarter ended Nov. 30, apparently caught administrators by surprise" as they expected "to make a surplus on the quarter's revenues of $385 million." Dr. Warren Gold, chair of the faculty association at UC Medical Center, said that "losing $10.7 million in the first quarter has to be not just unexpected, but a major problem." The Chronicle reports that two doctors who wished to remain "anonymous" said "some departments in the UC hospitals have been ordered to take 15% pay cuts, prompting some faculty to quit."
It's the Government's Fault
UCSF Stanford spokesperson Daniel Berman said the hospitals in the system admitted the expected number of patients, "but received less money than budgeted because of declining reimbursements for Medicare and Medi-Cal." In addition, the system's anticipated increases in payments from private health insurers "kicked in later than expected," according to Berman. Joanne Spetz of the Public Policy Institute of California said UCSF Stanford officials may have "made an error or a poor bargain" when negotiating fees with HMOs. In addition, Spetz said the recent merger may have left the system "top heavy" (Abate, 2/10).