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Published on 09/01/1997 All articles from this issue

El Camino Hospital becoming profitable again, officials say

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By Clyde Noel / Town Crier Staff Writer

A look at the financial statement released by El Camino Hospital management last month reveals a remarkable turnabout. It's not only a financial turnabout, but a shifting in employee morale.

At the end of 1995, Camino Healthcare lost $17.7 million on operations.

Some reports said the hospital was losing as much as $1 million a month during 1996.

For first six months of 1997, the El Camino Hospital District reported operating revenues of $78 million and operating expenses of $69 million, resulting in a $9 million profit.

Add in investment income and tax revenue, and the district reported close to $15 million income the first six months of 1997.

Because the district has assumed full control over hospital operations, it can write off a total of $13,978,932 for settlement and restructuring charges. These expenses were incurred in the Camino Medical Group (CMG) buyout and the curtailment of Camino Healthcare as a nonprofit entity.

Included in those expenses is the $4.3 million payment to CMG for their restructuring payment, a $3.6 million write-off of the unamortized capital gains tax paid on liquidating the former Sunnyvale Medical Clinic building, and a write-off of telecommunications data network system equipment and upgrades at all CMG sites for $1.3 million.

After deducting settlement charges from the six months income results, the hospital still maintained a $1,018,992 profit.

Patient count for the first six months was down 4 percent, with adult patient care administered to 54,023 patients.

Admissions increased 4 percent to 20,178 admissions, and outpatient care decreased slightly. Total deliveries increased 1 percent to 3,880 and total surgeries increased 4 percent to 6,341.

Richard Warren, El Camino Hospital's chief executive officer, took over administration Jan. 1, bringing the management style he used at Washington Hospital in Fremont for 25 years and executive personnel who knew his system. Together, the new management team reduced losses to a respectable profit.

"The day we get back the hospital and put it in the hands of the public we will be profitable from day one," said Paul Hoar, president of the district board, on running for re-election last November.