The Health Services Authority has set itself the ambitious goal of slashing $6 million from annual operating expenses through increased efficiency and spending cuts.
Acting CEO Lizzette Yearwood told staff recently the savings are necessary in the face of a bleak international economic outlook and the rising cost of living, which is impacting the authority’s operations.
‘Major increases in the cost of living, utilities and other related expenses over the past 18 months have significantly impacted the HSA’s operations, resulting in higher costs to provide care and increased operating expenses,’ Ms Yearwood said in a recent newsletter to staff.
‘… it is critical that we as an organisation make the necessary adjustments in the way we do business to become more efficient in these harsh economic realities.
‘Simply put, we must ensure that every time we write a cheque to pay a vendor or meet the monthly payroll, we have earned and collected enough revenue to cover these expenses,’ she said
In response, the authority has launched an internal efficiency review, appointing teams to advise on what can be done to increase efficiency and manage costs.
The challenge for the HSA, Ms Yearwood told staff, is to strike a balance between delivering sustainable high quality health care to patients while continuing efforts to be fiscally responsible and ensuring that all employees are properly compensated for the work they do.
The authority believes it can realise at least $500,000 in monthly savings by using overtime and manpower resources more judiciously, reducing overheads costs and more rigorously collecting debts.
The acting CEO also invited staff to provide ideas for how the authority can cut back on operating expenses. ‘I am sure that we can all cite many areas throughout the hospital where we can do things differently and more efficiently to achieve this target,’ Ms Yearwood said.
‘As we undertake this operational efficiency review we are to be guided by our mission to provide high quality, compassionate and cost effective healthcare.’
Turning the tide?
After requiring a government bailout of $14.2 million for losses accumulated during the 2006/07 financial year, the authority last year set itself the goal of being financially independent of government by mid-2009.
In January, the hospital decided to turn over all overdue hospital accounts to a private debt collection agency in an effort to boost its bottom line. Unaudited HSA accounts showed patients owed the hospital over $15 million at the time, $10 million of which was six months or more overdue.
In February, legislators authorised a long anticipated 10 per cent, across-the-board increase on HSA fees, the first since 2002. But with healthcare costs skyrocketing by between eight and 12 per cent annually, Health Minister Anthony Eden admitted at the time that many fees will remain well below cost.
The authority has also flagged plans to introduce a new charge master that will allow it to bill for some 4,500 services not included in the current listing.
Originally supposed to be introduced on 1 July, 2007, the charge master has yet to come into effect, however, after incompatibilities were discovered between its billing codes and insurance industry ones.
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