Mercy Iowa City reports improved finances, ready to grow

Mercy Iowa City (Iowa) President and CEO Sean Williams said the 234-bed hospital is on a better financial path and poised for growth, The Gazette reported.

Six things to know:

1. Mr. Williams became president and CEO of Mercy Iowa City in May. When he took over the role, the hospital was undergoing gradual changes related to its financial and operational improvement plan, which included layoffs and an affiliation, according to the report.

2. In September 2017, the hospital announced it would cut 115 positions, resulting in layoffs or reduction of hours for 65 full-time and part-time employees. Another 50 positions were left vacant after retirements or other attrition.

3. Mercy Iowa City attributed the job cuts to "the challenging healthcare environment and the competitive Iowa City market."

4. The hospital affiliated with Des Moines, Iowa-based Mercy Health Network in April 2017. Mr. Williams told The Gazette Mercy Health Network knew how to "right the ship," and the hospital has seen improved financial results.

5. Due to the layoffs, affiliation and other efforts, Mercy Iowa City saw operating income improve by more than $30 million in the last year, according to officials. Moody's Investors Service also upgraded the hospital to "Ba3" from "B1," affecting $34 million of debt, and concurrently revised the hospital's outlook to positive from negative. According to the report, Moody's did, however, say the organization still has "speculative elements" and "a significant credit risk."

6. Mr. Williams said the hospital is developing a strategic plan for the next three to five years, which will be completed in October. He told The Gazette the hospital's plans include strengthening partnerships with affiliated clinics and potentially expanding services.

Read the full report here.  

 

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