Old News Archive

D-F : HAD 4 Board OK's 2007 Mayo Budget

September 29, 2006 - TRC

DOVER-FOXCROFT - Hospital Administrative District 4 directors have approved a fiscal year 2007 operating budget for Mayo Regional Hospital and its eight associated physician practices, one marked by strong revenue growth and an increase in Mayo’s employment level.

Mayo anticipates net operating revenue of $36.2 million. After expenses of $35 million are factored, Mayo expects to generate operating income of $1,162,082, for a margin of 3.2%, in the fiscal year that begins Oct. 1. Net income is reinvested back into the nonprofit community hospital to fund depreciation, acquire new equipment and develop new programs.

Chief Financial Officer Dennis Allen said total hospital gross revenues are anticipated to increase by 10.27% in the upcoming year. Approximately half of the increase is due to greater use of hospital services, and half is due to rate changes.

Allen said most of the rise in Mayo’s revenues will come in the outpatient area, from increased activity in such departments as laboratory, radiology and pharmacy. Outpatient services, which account for 61% of gross patient revenue, are expected to increase revenues 11.5% in 2007.

Solid growth is also projected in Mayo’s network of physician offices, which are located in Corinna, Dexter, Dover-Foxcroft, Guilford and Milo. Physician office revenue is predicted to increase 12.5% in 2007, largely due to the addition of a staff psychiatrist and new physicians at Mayo Orthopaedics and Milo Family Practice. Physician office visits are expected to exceed 52,000 during the year.

Mayo plans a 5% overall general rate increase at the start of the fiscal year. It is the hospital’s first rate increase since 2003.

The hospital also expects to absorb bad debt and free care amounting to over $2.3 million. Free care provided to patients will increase due to a revision of qualifying guidelines and an expansion of patient eligibility to 150% of the federal poverty
guidelines.

Mayo’s work force next year, including hospital and physician office staff, is budgeted at 345 full-time equivalent positions, an increase of 20 positions over the previous year. Part of the employment increase is due to decreased reliance
on temporary agency personnel.

Mayo’s employment level has grown from 291 to 345 since 2004, driven both by increased use of hospital-based services and expansions of the hospital’s physician office
network and regional ambulance service. The state Department of Labor now lists Mayo Regional Hospital as the largest employer in Piscataquis County.

Total salaries and benefits at Mayo will reach nearly $22 million in 2007.

HAD 4 directors on Sept. 27 also authorized a hospital capital equipment budget
of $1.7 million. Of that total, $620,000 is earmarked for the Emergency Medical Service for the purchase of two new ambulances, construction of a new ambulance base to serve the Dexter/Corinna region, and acquisition of radio and monitoring equipment.

Other capital purchases include pharmacy dispensing, anesthesiology, information
technology and surgical services equipment. A new roof is scheduled to be installed on the main hospital, as well as other repairs and maintenance projects to buildings on the Dover-Foxcroft campus.


For more information contact : Tom Lizotte, Marketing & Development, 564-4342


NOTE - This article reflects the views of the author and not necessarily those of the TRC Alliance Team.