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Health system projects $30 million general fund surplus; recommends $25 million transfer for EHR project
Summary
CFO Greg Wagner reported a projected $30 million general fund surplus for the fiscal year driven by higher-than-expected revenues (including an $11.8 million Whole Person Care payment) and division-level variances; the report assumes a $25 million transfer into the EHR project and noted some expenditure pressures at the new hospital.
Greg Wagner, chief financial officer, presented the San Francisco Health Network’s second-quarter revenue and expenditure report for fiscal 2016–17. Wagner said the system was projecting a net $30 million general fund surplus for the year, which includes an $11.8 million payment for the first year of the Whole Person Care program (received after the report was prepared).
Wagner outlined division-level projections: a $1.6 million surplus at Zuckerberg San Francisco General Hospital (ZSFG), a $6 million surplus at Laguna Honda Hospital driven in part by higher Medi-Cal per-diem rates, a $3.4 million surplus in primary care (largely from capitation revenues) and a modest surplus in other services. He also noted a shortfall in capitation revenues tied to reduced Medi-Cal managed-care rates and an overage in salary and fringe at ZSFG related to operating the new hospital.
The report assumes a $25 million operating transfer to fund the electronic health-record (EHR) project and acknowledged an additional $15 million appropriation in the second year to keep the project on track; actual transfers and vendor selection will shape future spending plans.
Wagner warned that some variances (notably around substance-use waiver implementation and hospital staffing) are timing issues and that the 9-month report could show changes. He said the finance division has more tools to respond quickly to hospital actuals than in prior years and expressed cautious optimism about year-end performance.
Commissioners thanked staff and noted Finance and Planning Committee procedures for managing quarterly updates.
