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Care New England CFO hopeful after strong Q1 despite lingering staffing, supply struggles

By

Katie Castellani

-

03/06/2024

Kent-hospital — AFTER CARE NEW ENGLAND HEALTH SYSTEM started its 2024 fiscal year strong, CFO Todd Conklin is confident the health system will maintain its upward trajectory./COURTESY KENT COUNTY MEMORIAL HOSPITAL

PROVIDENCE – After Care New England Health System started its 2024 fiscal year strong, Chief Financial Officer Todd Conklin is confident the health system will maintain its upward trajectory. The state’s second-largest health system posted a $566,145 operating gain in the first quarter of 2024, showing improvement over the $13.7 million operating loss in the

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PROVIDENCE – After Care New England Health System started its 2024 fiscal year strong, Chief Financial Officer Todd Conklin is confident the health system will maintain its upward trajectory. The state’s second-largest health system posted a $566,145 operating gain in the first quarter of 2024, showing improvement over the $13.7 million operating loss in the same period last year. This also came on the heels of Care New England closing out fiscal year 2023 with a $14.2 million operating loss, which is over the $58.6 million loss from 2022. More specifically, Conklin said an increase in inpatient stays in several units including behavioral health and neonatal intensive care have contributed to clinical service growth. Additionally, the health system’s emergency department services have grown around 4% year over year and the surgical cases have risen 7%. Improved efficiency of Care New England’s emergency department operations has helped to decrease diversion time, which allows for better throughput into the health system’s other facilities, he said. As demand has increased the health system is also looking to recruit physicians to help keep up. However, recruitment and retention is an area Care New England is still looking to improve. In December Conklin told PBN that Care New England was still facing challenges related to recruiting and retaining workers even as its financial performance has improved. On Tuesday Conklin said those challenges remain and one of the health system’s primary focuses for 2024. According to Care New England’s most recent financial report, expenses rose $321.7 million compared to $342.9 million in the first quarter 2024, marking a $21.2 million increase. Contributing to this rise were fringe benefits, which were $2.3M higher in the first quarter of fiscal year 2024 over the first quarter of fiscal year 2023 due to health insurance, partially offset by a decrease in defined benefit plan pension costs. This also comes after Care New England’s expenses related to salary and wages rose to $157.3 million the previous quarter, marking an $8.8 million increase over the previous quarter and $8.6 million greater than the same period last year. Conklin previously said this increase was driven by a reliance on contract and agency labor and that he expected it to subside as the workforce has stabilized since the COVID-19 pandemic. This was supported by Care New England’s salary and wage expenses dropping to $152.9 million in the first quarter 2024, which is $270,375 greater than the same period last year, but a $4.4 million drop from end of 2023. To help reduce labor-related costs, Conklin said Care New England has invested in improving employee satisfaction with more training in orientation programs and ensuring the health system is offering competitive pay rates. Along with labor expenses, Conklin said Care New England is looking to improve its spending on supplies. In the most recent quarter the health system medical supply and drug expenses rose to $36.4 million, a $1.9 million increase from the same quarter the previous year. This increase comes after the health system spent at the end of 2023, marking a $3.5 million drop from the same period in 2022. To improve this Care New England is looking to leverage scale when acquiring supplies to ensure it gets the best price as well as using the supplies it does have more efficiently. Overall, as Care New England’s financial performance continues to improve Conklin said he's optimistic as the health system has yet to see the full return on its recent investment and programs. “We have smart growth initiatives that are only beginning to provide operational and financial momentum,” Conklin said. “It is the maturation of those activities that give us confidence of continued stability and improvement.” Katie Castellani is a PBN staff writer. You may contact her at Castellani@PBN.com.