Pen Bay Healthcare faces deficit

Posted Aug. 13, 2012, at 7:12 p.m.

ROCKPORT, Maine — A sharp increase in people without insurance is expected to result in the area’s health care system ending the budget year with a deficit.

Through the first nine months of the current budget year — Oct. 1, 2011 through June 30, 2012 — Pen Bay Healthcare said it has provided $3.25 million in free care. That is $837,000 more than the same period a year ago.

The increase is due to both fewer people being covered by the MaineCare program for low-income Mainers as well as fewer people receiving health care coverage through their work, according to Megan Williams, director of communications for Pen Bay Healthcare.

The largest component of Pen Bay Healthcare is Pen Bay Medical Center, the hospital located in Rockport. Other parts of Pen Bay Healthcare are the Quarry Hill retirement center in Camden, the Knox Center for Long Term Care in Rockland, and the Kno-Wal-Lin home health care and hospice.

Pen Bay Healthcare experienced an operating loss of more than $2.9 million through the first nine months of the fiscal year, according to Williams. There were some nonoperating revenues that helped offset some of the losses, but the overall net loss was more than $1 million through June 30. Pen Bay’s overall expenses for that period were about $111 million.

Free care is provided for people who earn up to 225 percent of the federal poverty level. That translates to $22,500 for a single person and $3,960 for every additional person in the family.

There are no plans to cut programs at this time, Williams said.

Pen Bay Healthcare President and Chief Executive Officer Wade Johnson said that by consolidating years ago, Pen Bay has been able to more effectively meet the needs of Knox County and people in the organization’s service area. He issued a written response to a question about how Pen Bay was faring financially as part of MaineHealth following the announcement earlier this month that St. Andrews Hospital and Healthcare Center in nearby Boothbay Harbor — which is also part of MaineHealth — would be closing its emergency room next year.

“Lincoln County Healthcare is having to make some very difficult decisions about where certain services should be provided to best meet the needs of their community,” Johnson stated. “In many cases, combining services into one location decreases the cost of care for the overall community and increases the level of service being provided at the new location. In health care, we are seeing smaller communities come together and pool their resources in order to build sustainable health care organizations for the future that will better meet the needs of everyone within their region.”

Johnson concluded: “At Pen Bay, we are very aware of the lack of health care funding at the state and federal level that is forcing many of these types of changes. We are actively engaged in reducing our costs and better understanding the needs of our community, so we can minimize service changes in the future.”

Pen Bay has seen a decline in the overall use of its facilities, according to statistics it released last week.

Williams said the economy is considered to be the major factor in the decrease in volumes that have been seen both statewide and nationally.

Emergency room visits at Pen Bay Medical Center are down 4 percent this year from a year ago, hospital admissions are down about 8 percent, surgeries down 10 percent, and hospice visits down 20 percent.

In the Boothbay Harbor region, there was criticism of the lack of community input before its local health care board made the decision to close the emergency department. Pen Bay Healthcare also responded to a question about community involvement in its planning.

“Now that the incorporators are formally disbanded, we have many other ways for people to learn about Pen Bay and participate with Pen Bay. One can participate as a committee member in a particular area of interest; finance, patient feedback, investments — to name a few,” Pen Bay said in a written response. “Community members can join our Pen Bay Partners in Care Council, which meets monthly. Community members can be invited to have lunch with our new CEO, Wade Johnson, who holds such luncheons on a monthly basis. We have physician speaking events, which the public is invited to — and we have many other education events throughout the year that the community is invited to. In addition, our current strategic planning process includes input from many community members from various backgrounds in Pen Bay’s service area.”

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