We anticipated the recession. In Spring 2008, we recognized that difficult economic times lay ahead and we took a number of steps when planning our fiscal 2009 budget, such as emphasizing efficiency and funding a conservative budget. For example, we have been trying to find a way not to fill certain vacated positions and we have been careful with capital budgeting.
However, we have delayed only one building project. Penn State Hershey has been involved in seven to eight building projects in the past three and half years and each has been carried out in a different way, so that we could be as strategic as possible. For example, we have launched several joint ventures with other entities, under which one party builds the building and leases the space to the other. We haven’t been locked into the notion that we have to own everything.
Our planning paid off. Penn State Hershey ended FY 2009 on June 30 in the black and above budget projections. We have not laid anyone off. In fact, we gave a raise to our rank-and-file employees. They deserved it. We had surpassed most organizational goals in terms of improving efficiency without harming quality.
Our future looks encouraging. Next year, we want to continue in the successful trajectory we’ve been on for the last several years. I am very encouraged about the future. Of course, we will need to continue expanding operations because if you don’t have enough space, you become inefficient. The future will really be about throughput — the amount of services that the organization can provide within a certain amount of space and time.
We are also working toward integration across the entire array of clinical services in the region. Penn State Hershey is pursuing affiliations with community hospitals in the region so that we can supply these hospitals with subspecialists they didn’t previously have access to. The goal is to keep patients close to home. This may mean bringing clinical trial sites to smaller communities, when possible. We know that many sick patients, such as those with cancer, do not travel well.
We’re awaiting the impact of healthcare reform. Healthcare reform will start impacting our enterprise next year, but it will take several years for the full impact to take hold. Massachusetts, which initiated health reforms more than two years ago, is only beginning to see the effects.
Whatever legislation is finally passed, it’s going to be very important that we, as an academic medical center, address issues around access, quality and safety and cost. Consumer issues will be important, and we think we are well positioned to deal with them. In 2008, Penn State Hershey was one of the top 100 hospitals named on the Community Value Index List of hospitals that demonstrate low costs, low charges and efficient use of financial resources while operating with a high degree of community value. And for the 12th year we’ve earned a Consumer Choice award from the National Research Corporation given to hospitals that are preferred by consumers in their particular marketplace.
We think healthcare reform will create a shift toward more ambulatory care. In the past few years we have been expanding our ambulatory care capacity. We built an outpatient specialty center with 100 exam rooms and its own imaging capabilities and now we are planning a primary care service facility.
Learn more about Dr. Harold Paz.
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