The system’s operating margin was 1.9 percent in the fiscal year that ended June 30, compared to 6.9 percent in the prior year, preliminary financial results show. The system had anticipated an operating margin of 3.5 percent. UI Hospitals and Clinics’ operating income was $28 million in fiscal year 2017, down 72 percent compared to fiscal year 2016.
The system in the report attributed its financial struggles to various factors, such as Medicaid Managed Care denials and budget cuts in Iowa.
But UI Hospitals and Clinics is making improvement efforts. The Gazette reports the system is considering the possibility of partnering with a larger system, although no potential partners have been identified.
Kenneth Kates, CEO of UI Hospitals and Clinics and associate vice president of University of Iowa Health Care, also cited multiple improvement efforts, which include “expense reduction initiatives, lowering full-time equivalent staffing [primarily through attrition], deferring capital projects where possible, investigating revenue enhancement initiatives and improving the hospital’s collection percentage,” the report states.
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