By Sarah Sharp
Olympic Peninsula News Group
Olympic Medical Center’s board of commissioners recently approved the hospital’s 2018 operating and capital budgets, as well as a 1 percent property tax levy.
On Nov. 15, commissioners unanimously approved the 2018 operating and capital budgets.
The levy will generate $4,158,115 in 2018, an increase of $41,169 from last year’s levy revenue, $4,116,946.
State law allows taxing districts, such as Clallam County Hospital District 2, to increase their local levy tax collection by as much as 1 percent each year.
Commissioners did not discuss the budget or levy further at the Wednesday meeting. CEO Eric Lewis said the budget had been discussed at length.
During a Nov. 1 public hearing on the 2018 budget, no community members offered input on the draft. The hearing closed within two minutes.
The hospital will draw from a net income of $4,092,136 in 2018.
Its total revenue stands at $202,520,812, leaving a net operating income of $3,592,136 after subtracting $198,928,676 in total operating expenses.
Lewis has said the hospital will aim to obtain a 3 percent margin in its 2018 operating budget — to first pay the principal on its debt and then make capital investments.
Now that commissioners have approved the budget, Chief Financial Officer Darryl Wolfe will create a three-year capital and cash flow plan, Lewis said Wednesday. That will be brought before the board for review, he said.
Capital budget
The capital budget for 2018, $16,899,081, sets aside funds for:
• $7,710,000 of hospital construction and upgrades, including $4 million for the Sequim campus expansion, $2,060,000 for central services/operating room upgrade and $1,650,000 for general routine/construction projects.
• $6,280,087 of medical equipment, including smart infusion pumps, endoscopy platform, sterile processing equipment, radiation therapy system and new scopes.
• $1,661,050 of information systems.
• $747,944 of non-medical equipment.
• $500,000 of unexpected costs.
Strategic plan
The board also unanimously approved a strategic plan for 2018-20.
The plan heralds three priorities: quality, patient safety and experience; OMC and community relationships; and organizational performance.
Among the plan’s measurable goals, the hospital aims to:
• Achieve a net income of 3 percent or more annually over the long term.
• Maintain 90 days or more of cash on hand, or the number of days the hospital can foot its operational costs. (In the first three quarters of 2017, Wolfe reported an average of 62 days of cash on hand.)
• Complete the Sequim cancer center expansion in 2019. (The $7.9 million expansion will include additional clinic exam space, a larger pharmacy, more infusion and chair space, and an education space that will allow an area for physicians and staff to explain the short- and long-term effects to patients and support them during difficult emotional times.)
• Begin inpatient bed redesign, surgical services expansion and remodeling at the Port Angeles campus, and complete construction by the end of 2019.
• Invest at least $5 million annually in medical equipment.
• Amp up recruitment efforts for hospitalists, pulmonology, cardiology, neurology and oncology in 2018.
“I think they’re the right goals for us to have, and they’re going to put us in the right direction,” Lewis said of the plan. “I think we did make some improvements to it, and it sharpens our direction for the future.”
Sarah Sharp is a reporter with the Olympic Peninsula News Group, which is composed of Sound Publishing newspapers Peninsula Daily News, Sequim Gazette and Forks Forum. She can be reached at 360-452-2345, ext. 56650, or at ssharp@ peninsula dailynews.com.
