The University of Vermont Health Network, a six-hospital system, posted $90 million in fiscal year 2022 losses (-3.3 percent margin), but provided details on how it plans to improve revenue, reduce expenses, and recruit and retain talent in 2023, according to a Nov. 17 news release shared with Becker's.
Five notes:
1. Burlington-based UVM Health Network largely attributed its annual loss to the increased cost of labor and providing patient care, adding that it has invested in temporary staff to meet patient needs as many of its hospitals "continue to be at capacity nearly every day."
2. The previously approved target margin by Vermont regulators for fiscal year 2022 was $66.5 million (2.5 percent margin). Operating margin is what nonprofit systems use to invest in people, buildings and equipment, to provide high-quality care and pay staff competitively, but a financially stable health system should see a minimum 3 percent operating margin, according to UVM Health Network.
3. Without $55 million in one-time state and federal funds received this year to support expenses incurred due to COVID-19 initiatives and losses, UVM Health Network said the loss across its organization would have been $145 million (-5.3 percent margin).
4. The system said it is implementing a series of programs, known as the "Path Forward," to stabilize its financial condition. They include managing patient beds, and post-acute and surgical capacity; reducing reliance on temporary staff; prioritizing hybrid and remote positions; and expanding its pharmacy services.
5. UVM Health Network employs 138 people in 37 states outside of Vermont and New York, and saved about $1 million by reducing leases for office space no longer needed. In terms of patient care, the system decreased wait times for radiology scans at UVM Medical Center from eight weeks to two weeks, partly due to the addition of a new MRI machine. Adding weekend appointments for patients requiring diagnostic PET and CT scans also helped decrease wait times from eight weeks to four to six weeks, according to the health system.
"Our year-end financial results are consistent with the sharply increased cost of labor and providing patient care we have been experiencing for months," CFO Rick Vincent said in the release. "We know this continues to be a challenging time in healthcare, and we are continuing to do the hard work to stabilize our organization and protect the critical services that our patients rely on us to provide."