State with unexpected no red ink6/21/2023 ![]() ![]() ![]() The health care system contributes a share of costs related to its workers covered by the city fund. The city’s pension fund covers some Alliance employees as well as city workers. CHA will return to the black in 2021 with a $4.3 million budgeted margin, according to a presentation made to the finance committee. One reason: the unforeseen pension cost, according to the 2020 budget document. The Alliance expects to report a slight gain of $300,000 for fiscal 2019, substantially less than the $2.4 million surplus that had been predicted. The board adopted the budget July 9, with several trustees expressing qualms about approving a plan that forecasts a loss of that size but still voting in favor. The nonrecurring expenses are for system improvements in the information technology area, which would not come out of the operating budget for most other hospitals – but the Alliance, as a public hospital, must put them in the operating category, according to accounting rules for government agencies, officials said.Ī budget summary said managers considered “a variety of opportunities” to get to break-even status by cutting costs, but rejected them because they “would be very disruptive to CHA operations.” The finance committee agreed, voting to recommend the budget to the board of trustees. Those one-time expenses are the fundamental culprit, although the unexpected pension cost pushed the loss to a level that looked more alarming. Both estimates include $6 million in one-time expenses. Before the transfer to the pension fund, officials forecast a loss of $2.3 million. The Alliance now expects to lose $4.3 million on health care operations in 2020. Cambridge Health Alliance’s spending for the next fiscal year includes a surprise $2.7 million in pension funds but also the cost of adding the equivalent of 57 full-time positions in doctors and other clinicians. (Photo: Marc Levy)Ĭambridge Health Alliance will lose more money than it anticipated in the next year because the health care system unexpectedly needed to add $2.7 million to the city’s pension fund just a few weeks before the fiscal year started July 1.Ĭhief financial officer Jill Batty gave the bad news to Alliance trustees on the finance committee June 27 as the panel discussed the proposed budget for fiscal year 2020. ![]()
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