"A hospital like this might expect a performance like this once in a generation. This was an unusual year," CEO Ken Graham said.
Better results were based on a number of one-time factors. The nonprofit hospital received about $10 million from arbitration and settlements with insurance companies, which had withheld payments from previous years. Investments in securities also performed well, contributing about $17 million. Patient care generated about $47.5 million in net revenue.
Administrators had planned to have 300 days' worth of cash on hand, so the hospital could operate without any incoming revenue, and beat that goal by 20 percent. The hospital now has 360 days' worth of cash on hand.
Graham said the money will go into investments, new medical equipment and facilities as the hospital prepares to pay back its $148 million bond for building a new earthquake-safe structure. Starting in 2010, the hospital will have to begin paying back $25 million a year on the bond debt.
"We are planning on very hard years in 2010 and 2011 as we take on a new building, a new mortgage and moving expenses," Graham said. The hospital may apply some of the increased funds to what he expects "will be a real tough two years ahead of us."
Construction of the new hospital is one-third complete and going smoothly, according to hospital officials, who say the project is on time and on budget. The project is slated to be finished by June 2009.
"We have the benefit of having a really experienced contract team," said project manager Ken King.
The steel infrastructure to the main building is complete, and contractors will begin working with doctors to choose which medical equipment to install.
So long as no unforeseen accidents or expenditures occur, the hospital may have money left in its contingency fund for an artwork centerpiece to grace the entrance, King said. But the board will not make a decision on the artwork expenditure until members are certain the budget allows for it.
The hospital board plans to hire one of four audit firms, including Jefferson Wells, Faithful & Gould, and Pricewaterhouse Coopers, to check construction costs.
This story contains 385 words.
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