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Hospital's deficit still on the rise

As the losses mount, officials see progress in cost-cutting efforts and a move toward affiliation.

Helen Ellis Memorial Hospital lost $426,000 in June, raising its deficit to $1.8-million for the accounting year that began in October.

Administrators expect the deficit to worsen during the next three months.

Hospital administrator Joseph Kiefer balanced that latest round of bad financial news Monday with a report that the hospital is on track in its search for an affiliate to keep the institution operating long-term.

The hospital, which lost $1.3-million last year, remains short of cash, although cash on hand improved to more than $300,000, June financial statements show. The total was less than $100,000 earlier this year. The hospital was more aggressive in collecting money that it was owed by managed care firms, Kiefer said.

The June operating loss came despite the hospital's success at trimming costs to more than $500,000 under budget, Kiefer said. The hospital's hiring freeze and cutbacks of employees' hours contributed to the savings.

The hospital also has consolidated the care being given in two patient wings or two surgery suites from time to time when one could handle the combined demand.

The number of people admitted to the hospital dropped 6.6 percent from June 1998. The hospital had forecast an increase of about 6 percent.

The hospital was 51.2 percent full in June, when it was nearly 60 percent full a year ago.

Helen Ellis executives have cut costs about as far as they can without compromising patient care, said Kiefer and financial consultant J. Michael Mauldin of William R. Hough and Co. of St. Petersburg.

"A lot of it is going to depend on patient volumes," Mauldin said.

The administrators are focusing on keeping losses as low as possible until an affiliation agreement can be reached.

The search for a partner confirmed that two hospital groups that have been discussed all along are still interested in a deal with Helen Ellis: Morton Plant Mease Healthcare, and the alliance between University Community Hospital of Tampa and Adventist Health System of Winter Park.

A third group also expressed interest, Kiefer said, but he declined to name it.

"They asked not to be named at this time," he said.

The City Commission one month ago expressed a preference for a non-profit affiliate for the hospital, Kiefer said. The city owns the hospital land and buildings and leases them to the non-profit Tarpon Springs Hospital Foundation through a public financing authority.

The three groups that responded to the hospital's search for an affiliate represent enough interest from non-profit groups that the hospital sees no reason to consider for-profit possibilities now, Mauldin said.

The hospital approached 25 non-profit hospital groups across Florida about the possibility of teaming up, Kiefer said.

Five responded: the three that are interested, and two that said no. Kiefer said the hospital will check with the other 20 to make sure the hospital begins negotiations with as many suitors as possible.

The hospital is asking potential affiliates to submit outlines of their proposals by Aug. 27. The affiliation will probably be a merger or joint operating agreement, Mauldin said.

As it pursues a deal, the hospital is still trying to negotiate better managed care deals and looking forward to the traditionally busy _ and profitable _ winter season.

"We can't afford to let this hospital slide in the interim," Mauldin said.

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