Rising bad debt, increasing charity care and the shortfall between Medicare/Medicaid payments and actual costs will drive a 5 percent rise in charges at Olympic Medical Center in 2005.
The hospital district also will hike its maintenance and operations levy by 1 percent.
The across-the-board increase has been 4 to 5 percent for each of the past several years, said Eric Lewis, the hospital’s chief financial officer.
Rhonda LoPresti, OMC public relations director, said some other hospitals have increased their charges as much as 18 percent for next year.
“Generally, it’s 5 percent across the board,” Lewis said. “Our charges are very low compared to other hospitals.”
The increase in the levy — currently 15 cents per $1,000 of assessed valuation — will boost OMC’s Clallam County Public Hospital District No. 2 tax payment on a $150,000 house from $24 per year to $24.24, said Lewis.
He added that annual increases in the levy of the legal limit of 1 percent without voter approval have been common.
$87.1 million budget
OMC will spend almost $87.1 million in 2005 while collecting $90.8 million in total operating revenue, according to budget figures presented Wednesday to hospital district commissioners.
The resulting $3.7 million in projected net operating income and $4.7 million net revenue mirror 2004 returns, despite increased costs of supplies, maintenance and salaries and benefits, in addition to free care and bad debt.
The hospital’s operating margin, however, slips from 4.5 to 4 percent. Operating margin represents what the medical center can reinvest in itself through capital improvements.
Figures are rounded to the nearest $100,000.
Commissioners held a hearing on the budget at their meeting Wednesday night at the Port Angeles hospital. They expect to adopt the 73-page spending plan, perhaps with minor revisions, when they meet again Nov. 17.
