MOAB REGIONAL HOSPITAL Many said a small, rural, unaffiliated hospital could not survive. Many such institutions have not. The Moab Re- gional Hospital was a 17-bed acute care facility located in Moab, Utah. The community consisted of only 9,000 permanent residents, but millions of tourists visited the area annually. The hospital had experienced a high turnover of personnel and struggled with a low census (averaged about four inpatients).The hospital, opened in 1957, was originally known Income Statement as the Allen Memorial Hospital. It was operated by a local Period ending date 12/31/2015 12/31/2014 12/31/2013 12/31/2012 12/31/2011 board and funded by a hospital special service district. Inpatient revenue $ 12,221,479 $10,969,949 $ 10,031,442 $ 8,429,060 $ 7,337,909 This situation continued until 1995, when voters turned Outpatient revenue $ 31,000,073 $29,817,093 $ 26,377,807 $ 27,143,672 $19,993,503 down the reapproval of a property tax to support the hos- Total patient revenue $ 43,221,552 $40,787,042 $36,409,249 $ 35,572,732 $ 27,331,412 pital. The hospital plant was then almost 50 years old and Contractual allowance $ 16,726,220 $14,600,346 $ 14,232,265 $ 13,488,251 $ 7,096,046 (discounts) badly needed replacement. Seeking to improve efficiency, Net patient revenues $26,495,332 $26,186,696 $ 22,176,984 $22,084,481 $20,235,366 a 501(c) (3) nonprofit was created to run the hospital with Total operating expense $24,048,564 $23,546,759 $ 21,884,181 $23,060,846 $ 22,477,512 the special district still owning the old hospital. Drawing Operating income $ 2,446,768 $ 2,639,937 $ 292,803 -$ 976,365 -$ 2,242,146 Other income $ 52,405 $ 238,074 $ 6,463 $ 188,486 $ 1,979 on donations and large loans, the new hospital organi- (contributions, bequests) zation designed and built a facility that opened in 2011. Income from investments $ 133,148 $ 22,852 $ 75,166 $ 24,278 $ 321 Governmental $ $ $ $ $ The new building was a great improvement, but appropriations long-standing management problems remained. The Miscellaneous nonpatient $ 890,792 $ 1,047,414 $1,181,493 $1,083,516 $1,167,274 revenue CEO and the CFO feuded and rarely spoke. Billings were Total nonpatient revenue $ 1,076,345 $1,308,340 $1,263,122 $1,296,280 $1,169,574 not done on a timely basis, and the hospital's cash flow Total other expenses $ 5,062 $ 100,861 $ $ 0 $ dissolved. Finally, in 2011, both the CEO and CFO quit Net income $ 3,518,051 $3,847,416 $1,555,925 $ 319,915 -$1,072,572 and new management was brought in. The new CFO had Source: Data from American Hospital Directory (2017). a long history of turning around hospitals. Moab Re- gional Hospital went another year without a permanent CEO. The financial results from 2011 to 2015 follow:Balance Sheet hospital had made excellent progress: Period ending date 12/31/ 2015 12/31/2014 12/31/2013 12/31/2012 12/31/2011 Assets Period ending date 12/31/2015 12/31/2014 12/31/2013 12/31/2012 12/31/2011 Current assets $19,807,244 $16,355,826 $ 13,620,869 $ 8,576,542 $ 8,398,854 Days Cash on Hand 260.7 191.4 151.1 48.4 27.4 Fixed assets $23,246,503 $25,226,195 $ 27,585,630 $29,295,953 $ 31,397,655 Definition: (Cash on hand + Other assets $ 4,001,006 $ 3,861,131 $ 1,895,151 $ 3,071,023 $ Market securities) + (Total operating expenses - Depre- Total assets $ 47,054753 $45,443,152 $ 43,101,650 $40,943,518 $39.796,509 ciation ) + 365 Liabilities and fund balances Source: Data from American Hospital Directory (2017). Current liabilities $ 3,227,209 $ 3,998,466 $ 4,500,959 $ 4,331,291 $ 3,668,477 Long-term liabilities $27,580,010 $28,635.764 $29,496,033 $29,093,346 $ 28,901,011 He now wanted to continue to analyze the rest of Total liabilities $30,807,219 $32,634,230 $33,996,992 $33,424,637 $32,569,488 the operation. Using both raw numbers and ratios, com- Total fund balances $16,247,534 $12,808,922 $ 9,104,658 $ 7,518,881 $ 7,227,021 Total liabilities and fund $ 47,054753 $ 45,443,152 $ 43,101,650 $40,943,518 $39,796,509 plete the following tasks: balances 1 . Identify which areas have improved and attempt Source: Data from American Hospital Directory (2017). to explain why these changes have occurred. 2 . Compare the ratios to the national financial ratios The chair of the board's performance committee in the chapter and discuss which are excellent or has been asked to evaluate the progress of the hospital. good, and which ones need improvement. He remembered a few years ago when suppliers would 3. Identify what additional information you might re- only deliver if paid by cash and short-term loans were quest to understand what has and is occurring at used to make payroll. Given this situation, he began by the hospital more thoroughly. computing the days of cash on hand and found that the