Thursday, May 31, 2007
Northside and Beeghly post operating profits for the first time in three years.
By DON SHILLING
VINDICATOR BUSINESS EDITOR
YOUNGSTOWN — Forum Health posted a $2.14 million operating profit in April after losing money in the first three months of the year.
Last month’s profit was aided by $286,000 in operating earnings from Northside Medical Center in Youngstown and Beeghly Medical Park in Boardman, which was the first time they had a profitable month since March 2004. They operate as one unit called Western Reserve Care System.
Forum’s biggest moneymaker in April was Trumbull Memorial Hospital in Warren, which posted operating earnings of $1.78 million.
Forum posted a systemwide operating loss of $23.6 million last year. Operating earnings represent the money generated from daily operations, minus expenses, and exclude items such as taxes.
Concerns
Dr. Keith Ghezzi, Forum interim president and chief executive, reported April’s financial numbers on the company’s Web site in a memo that covered the May 22 board of directors meeting.
Ghezzi said the operating profits in April “demonstrate the hard work and extraordinary commitment Forum’s managers, employees and physicians have devoted to our turnaround efforts.”
He added, however, that profits at Northside are not expected to continue at these levels for the rest of the year.
Forum has identified more than $60 million in savings and revenue enhancements since the turnaround effort began in January 2006, he said.
Still, Ghezzi cited several factors that continue to work against the troubled medical provider.
He noted that Forum lost money during the first quarter of the year, although he didn’t provide any details.
Second, he said Forum’s $180 million debt “remains a tremendous strain on our ability to make necessary investments.”
He added that the opening of St. Elizabeth Health Center’s Boardman hospital later this year “will pose a serious competitive and financial challenge.”
Investors and unions
As Forum continues to try to improve its finances, it also is looking into a sale of its facilities. Ghezzi said a report to the board indicated that there has been significant interest from potential investors.
He said this interest underscores the quality of health care Forum is providing and its tradition of service. New capital and resources from investors could assure Forum’s operations for years to come, he said.
Ghezzi also said he hopes to reach a new labor contract with the Youngstown General Duty Nurses Association before the current contract expires July 19. The two sides have met twice this month.
Ghezzi noted that Forum has been aided by contracts with two other unions that provide greater efficiency and cost controls.
He added that he thinks marketing campaigns that have featured newspaper ads focused on Forum employees have helped to increase patient volumes. That campaign will be expanded, he said.
shilling@vindy.com