Financial Performance

In 2020, supply chain costs are projected to surpass labor as the greatest expense for the average hospital. That’s why the supply chain continues to be a main focus of cost-reduction efforts. Moving forward, however, hospitals are making strategic and data-driven supply chain changes to bring about more effective care delivery. Gone are the days of relegating supply chain to a cost-reduction target. In fact, larger hospital systems have elevated the supply chain leader’s role to a C-level position, reflecting the sophistication required for an optimized supply chain.

Data-driven Supply...

Gainesville Hospital District saw light at the end of the tunnel—a new beginning for North Texas Medical Center (NTMC). The district had leveraged bankruptcy to get the legal protection and time it needed to develop a plan to restructure $40 million in debt, pay creditors, and keep the hospital open. The district secured debtor-in-possession financing and filed a bond validation to enhance the appeal of its bonds as investments. Gainesville Hospital District was on the right track to emerge from Chapter 9, but the district needed to...

Stemming the closure rate of rural hospitals may depend in part on the financial support provided by hospital tax districts. This can be difficult to swallow for many who are reflexively against higher taxes. However, voters may come around when the case is made that a modest property- or sales-tax levy or hike could provide the necessary financial support to keep their hospital open and sustainable for their community.

Hospital Tax Districts Fill a Funding Gap

Tax districts help ensure the survival of hospitals that may be at risk of...

A recent blog post by Community Hospital Corporation (CHC) details the situation that caused Southwest Health System to reach out to CHC for assistance in early 2018, the plan they created to turn around the hospital, and the final results to date.

When the Southwest Health System (SHS), in Cortez, Colorado, contacted Community Hospital Corporation (CHC) early in 2018, the hospital had violated various bond covenants associated with its $30 million expansion and renovation project. In fact, the organization had failed to meet the 80 days-cash-on-hand requirements for four consecutive...

A recent guest blog by Community Hospital Corporation (CHC) featured tips for successful turnaround by Anthony Sudduth, CEO of Southwest Health System.

Last year, Southwest Health System (SHS), in Cortez, Colorado, found itself in the midst of a significant financial crisis. The hospital had violated bond covenants associated with a $32 million building project, failing to meet the 80 days cash-on-hand requirement for four consecutive quarters. This violation triggered technical default, which could have led to bankruptcy and closure. Instead, SHS acted swiftly and decisively, becoming not a cautionary tale...

GUEST BLOG

By Anthony Sudduth, CEO, Southwest Health System

Last year, Southwest Health System (SHS), in Cortez, Colorado, found itself in the midst of a significant financial crisis. The hospital had violated bond covenants associated with a $32 million building project, failing to meet the 80 days cash-on-hand requirement for four consecutive quarters. This violation triggered technical default, which could have led to bankruptcy and closure. Instead, SHS acted swiftly and decisively, becoming not a cautionary tale but a comeback story and an inspiration.

The SHS turnaround is a bright...

When the Southwest Health System (SHS), in Cortez, Colorado, contacted Community Hospital Corporation (CHC) early in 2018, the hospital had violated various bond covenants associated with its $30 million expansion and renovation project. In fact, the organization had failed to meet the 80 days-cash-on-hand requirements for four consecutive quarters. This violation triggered technical default, which could have led to hospital bankruptcy
and closure.

Lenders concerned with the financial situation communicated with the board directly and required an outside consulting firm to evaluate the situation and develop a...

To what degree should boards be involved in the finances and operations of their hospitals? This is an important question, because effective hospital boards are clear on their roles and responsibilities. That role is hospital governance while management is the responsibility of the hospital leadership team. That means board members must focus on strategy and leave operations to hospital leadership. Yet, it’s not only appropriate but also imperative that board members understand the finances and operations of their hospital.

That means board members must discern the financial situation; education about...