Phoebe Putney Memorial Hospital Board OKs FY 2017 budget, agreement on property sale

ALBANY — A lack of quorum at the Phoebe Putney Memorial Hospital Board of Directors meeting on Aug. 3 made it necessary for the board to have a special called meeting Thursday evening to take action on several items.

Among them was the hospital’s budget for Fiscal Year 2017, and the lease-and-transfer agreement for 1912 Arlington Lane — both of which were unanimously approved at the meeting, which was conducted at Doublegate Country Club.

The Hospital Authority of Albany-Dougherty County voted in May to proceed with discussions to sell the Arlington Lane property, which had been home to Phoebe Pediatric Specialty Clinics, to Dr. Paul Payne of Southwest Georgia Obstetrics and Gynecology to accommodate the expanding practice next door.

A lease-and-transfer agreement was put in place, including first right of refusal language at fair market value based on appraisal. It was acquired by the Hospital Authority as part of the Palmyra Medical Center, now Phoebe North, purchase in 2011.

The action taken by the hospital’s board on Thursday evening allows the purchase to move forward.

The sale of the facility is expected to close in the next few months for a price of $356,000. Jay Reynolds, the Hospital Authority attorney, suggested at the Hospital Authority’s meeting on Thursday that a motion be placed on the table for the balance of $100,000 from the sale be given to Phoebe for releasing the property from a 50-year lease, which was approved.

The property has an appraised value ranging from $456,000-$479,000.

In regard to the FY 2017 budget, Brian Church, senior vice president and chief financial officer for Phoebe Putney Health System, told the board at its regular meeting on Aug. 3 that the continued impact of reimbursement reductions brought on by the Affordable Care Act and a lack of Medicaid expansion in Georgia will result in a $2 million drop in reimbursements in 2017 — bringing the total loss of those reimbursement over the last several years to around $17.6 million for Phoebe.

The system’s main hospital has budgeted for 20,204 admissions and 113,546 inpatient days for the fiscal year, and is budgeting the equivalent of 2,924 full-time jobs at $253 million. The health system is budgeting a total of 4,335 full-time jobs, Church said.

The Georgia Hospital Association Economic Impact Report released in March had Phoebe’s overall economic impact at $1.5 billion for Southwest Georgia.

The hospital’s FY 2017 budget calls for $32.5 million in capital expenditures, a reduction from the previous two years. This includes $15.9 million for facility projects, $5.9 million in medical equipment, $4.33 million for operating room improvements and equipment, and $3.5 million for information systems and telecommunications.

The hospital is budgeting to provide more than $275 million in community benefit support, including $30 million in indigent and charity care. Church said $948,000 is earmarked for a voluntary payment in lieu of taxes for Phoebe North.

There is no increase expected in room rates, gastrointestinal procedure costs, outpatient computed tomography and magnetic resonance imaging pricing or charges already higher than Phoebe’s peers. There have been increases in services in areas below peer comparisons, and there is a 3.5 percent overall hospital charge increase expected, he said.

The budget also includes a 3 percent compensation increase for the Phoebe work force during the third quarter of FY 2017, a marketing campaign for education on consumer access, continued optimization of the current electronic medical records system, and a partnership with Grady Healthcare for transport services.