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SVMC MITIGATION PLAN

March 18, 2015

ITEM

PROJECTED
FINANCIAL IMPACT
TBD

NET REVENUE INCREASE

Discussions with Managed Care Payers

$0

Institute dialogue with top 15 admitters and review documentation and LOS

$0

Limit observation admissions

$0

Other Initiatives

$0

OPERATING EXPENSE REDUCTIONS

OPERATING UNIT EFFICIENCY- SURGERY


All scheduled surgeries need financial approval
Institute a 3 day surgery scheduling notice to allow evaluation of costs
Clinical documentation to work with top active surgeons to improve clinical
documentation
No elective surgeries are to be scheduled on the weekends

TBD
$0
$0
$0
$0

LABOR COST REDUCTIONS


FTE reduction of exempt management and associates

44 FTEs
Medicare GMLOS Improvement
Other LOS Reduction Initiatives
Productivity Improvement
Premium Pay/Registry Use

$9,810,288
$4,718,288

SUPPLIES
Supplies are 15% of net revenue excluding implants. Reduce by $2 Million
Sodexo Contract Payment Reduction of $750,000.00

$2,750,000
$2,000,000
$750,000

MD CONTRACTS
90-Day Notice for Medical Directors and Hospital Based Physician Contracts/
Reduction
$0.5 Million for Medical Directors
$1 Million for Hospital Based Physician Contracts

$1,500,000

PURCHASED SERVICES
SERVICE LINE/PROGRAM CLOSURE
Casa de Amigos
APLC
Health Benefit Resource Center
Multicultural Health Awareness and Prevention Center
General Orthopedic Clinic

TBD
$2,250,000
$400,000
$450,000
$400,000
$400,000
$600,000

$2,092,000
$2,000,000
$0
$1,000,000

TOTAL

$500,000
$1,000,000

$16,310,288

Mitigation Plan
Facility:
Prepared Date:

SVMC
3/18/2015

Net Revenue Enhancements:


Managed Care Payers (1)
Observation Unit Impact
Service Line/Program Closure (2)
Other Initiatives
Total: Net Revenue Enhancements

$
$
$
$
$

Operating Expenses:
Labor Costs
Reduction In Force (3)
Productivity Improvement
Medicare GMLOS Improvement
Other LOS Reduction Initiatives
Premium Pay Reductions
Service Line/Program Closures
Sub-Total- Labor

$ 4,718,288
$
$ 2,092,000
$ 2,000,000
$ 1,000,000
$ 2,250,000
$ 12,060,288

Non-Labor Costs
Supplies
Professional Fees
Medical Directorships/Stipends
Purchased Services
All Other Items
Sub-Total- Non-Labor Costs

$
$
$
$
$
$

Total: Operating Expenses

$ 16,310,288

2,000,000
1,500,000
750,000
4,250,000

Annualized EBIDA Improvement


$ 16,310,288
Notes:
(1) Projected Net Revenue Improvement based on Managed Care negotiations
(2) Reduction in Net Revenue due to Service Line/Program Closure, if any.
(3) Savings net of severance related costs. Detail listing to be provided for review.