North Central Healthcare presents balanced 2026 budget, flags staffing and insurance costs

North Central Healthcare officials told the committee they have a balanced budget for 2026 but face several structural challenges that could tighten operations in coming years. Jason, presenting the budget, said the organization’s 2026 budget is about $94.4 million, with roughly 73% funded by billable services and a relatively small portion covered by tax levy.

Jason said the organization faces labor shortages that increase reliance on agency staff; the 2026 budget includes approximately $2.3 million in agency-staffing costs. He said a 3% compensation increase for 2026 equates to about $1.3 million and that projected health-insurance premium increases (about 10%) add roughly $700,000 to costs. Debt-service costs tied to a campus remodel will rise to about $3 million in 2026 and are projected to increase further in subsequent years.

Officials also said the recent sale of Pinecrest removed a revenue source that had been covering indirect costs; North Central must find roughly $1.2 million in 2026 to replace that coverage. Jason said cash-on-hand has grown in recent years and stands at roughly 130 days’ operating cash, which provides some buffer, but warned budgeting will get more difficult as margins tighten.

The budget presentation highlighted recent positive steps: two child psychiatrists were added in 2025 to bolster inpatient and outpatient care, and several service lines have seen census growth. North Central also plans a five-year capital plan that anticipates major investments in an ERP system and a new electronic health record.

Committee members asked about opportunities to coordinate behavioral-health and wraparound services with county homelessness efforts; North Central officials said voluntary community-treatment services and case-management supports exist but are limited by capacity and funding, and that the organization will continue to explore partnerships.