Hurt by insurance payment reductionsand still too many expenses, El Camino Hospital management facesanother $2.5 million loss for fiscal year 1995-1996. Some expertssay the loss may be as high as $7 million.
“In order for Camino Healthcare to achieve a break-even budgetfor the fiscal year 1996-1997, we must reduce our expenses by15 percent or approximately $29 million,” said John Reiber,Camino Healthcare’s chief financial officer. “To set thetone for the coming fiscal year, we have to begin implementingadditional cost reduction plans immediately.”
Camino Healthcare lost approximately $17.7 million in the 1994-1995fiscal year on revenues of $280 million.
The final budget will be presented at the end of June. Fiscalyear 1996-97 begins July 1.
According to Reiber, Camino Healthcare managers have been askedto reduce expenses and consolidate department overhead. The CaminoHealthcare Board of Directors will recommend what action to takeat the end of June. No cuts will be made until then, Reiber said.
“The price of our services is dropping in the market andwe are being paid less for what we offer,” he said. “Nobusiness can continue on this level so we have to decrease ourlosses and control our expenses in order to survive.”
“We want to compare ourselves to other hospitals in SantaClara County and see how we are doing,” said Jerry Shefren,M.D., Camino Healthcare chief medical officer. “If we arelosing money we want to know where the cuts will come, and inwhat departments to start by comparing our costs to other hospitalsin the county.”
Lynn Briody, chairwoman of the Camino Healthcare board, said,”Medical care is different than even a few years ago. Morecare is delivered outside the hospital in patients’ homes, communityclinics and schools.
“Procedures that we used in the past kept patients in hospitalsfor a week. Now that treatment requires only an overnight stayor is done in the outpatient department.”
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