Panama City- Bay Medical Center’s CEO, Steve Johnson is facing the same problems faced by most heads of multi-million dollar organizations…poor finances.
In Bay Medical's case, Johnson says the hospital's biggest problem is treating uninsured patients who can't pay the bill.
"We've got a situation where our uncompensated care has grown about 11 million dollars in 2001 to 33 million dollars now. That’s a 300 percent increase since 2001.”
Couple that with a bad economy, and changes in the Medicare and Medicaid programs, and you can understand why Bay Medical Center is struggling financially.
In an effort to control the crisis, the hospital's board of trustees is looking for someone to refinance the hospital's debts.
"The uncompensated care trend is not a sustainable business model that we cannot not address. We have to be dealing with that along with the issues around Medicaid and issues around health reform. So I think taking action is appropriate," said Johnson.
The board has contacted a number of healthcare management companies like Sacred Heart to discuss refinancing possibilities.
Johnson insists the hospital is not for sale.
When asked if a refinancing deal would mean a change in the hospital's management structure, Johnson says it's too early in the process to determine those type of details, but he does says once a deal is in place, you and other patients will see very few changes.
"At the end of the day, it will be transparent. We've got this beautiful new facility. We've got great staff. We've got great doctors. I can assure you that it would be totally transparent whatever happens."
When they began planning and building the new 80 million dollar patient tower facility, the economy was booming.
If he had known then what type of economic environment he'd be facing today, Johnson says the hospital probably would have delayed the tower project."
The bigger issue is the changes in the hospital's Medicaid reimbursement.
"Effective July of next year we'll have a new reimbursement system under Medicaid that's probably going to cost us another seven figures in reimbursement cuts," Johnson said.
Despite Republican promises to repeal the Obama Healthcare Reform Bill, Johnson isn't confident that will take place.
Even though there is a lot of uncertainty regarding the effects of these future changes, Johnson says the hospital's current debt is a certainty, and needs to be addressed sooner than later.