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Financial Audit 2020

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Financial Audit 2020

Gronewold, Bell, Kyhnn & Co. P.C. CPAs has released its financial audit report on Myrtue Medical Center, Harlan, Iowa.

Revenues totaled $46,005,300 for the year ended June 30, 2020, a 1.14 percent decrease, excluding COVID 19 Funds. Including COVID 19 Funds, revenues increased 3.8 percent from 2019. The revenues included $41,939,600 in net patient revenue, $670,100 in other operating revenue, $1,018,500 from county taxes, $2,179,400 from the COVID 19 Funds and $84,000 in interest on investments. Capital grants and contributions totaled $113,700.

Expenses for the year totaled $44,719,600, a 4.4 percent increase from the prior year, and included $16,717,900 for salaries and wages, $6,537,200 for employee benefits, $10,569,800 for supplies and other expenses, $7,609,900 for professional fees, $3,004,300 for depreciation, $159,700 for interest, $112,200 for ambulance services, and $8,600 loss on disposal of assets.

The COVID-19 pandemic dominated the activities of the Medical Center in 2020. All major purchases and projects were put on hold during the pandemic. The Medical Center took advantage of various funding sources made available through federal and state government, including advance payment for Medicare claims, Payroll Protection Program, FEMA, Iowa Department of Public Health, and, other local and regional area grants and foundations. The advance payment funding will be paid back to Medicare over the next few years. The Provider Protection Funding repayment is based on legislative rules that are yet to be final. By February 2020, prior to the COVID-19 pandemic, Myrtue was experiencing a 7.4 percent increase in gross patient revenue for the fiscal year. By April, visits dropped 49 percent, three satellite clinics were temporarily closed, and surgeries were suspended. Although patient visits had begun to rebounded by the end of June the Medical Center reported an operating loss this year of $1,829,300 compared to operating income in the prior year of $198,800. The Medical Center finished the 2020 fiscal year with net income from all sources of $1,193,550 compared to $1,174,750 in 2019.

During the auditor's presentation of the financial statements at the Board meeting, many positive financial indicators were discussed. The Medical Center’s collections of patient receivables showed improvement for the second year following a computer conversion, and continues to report positive cash flow from operations and increase in its cash and investments. The Medical Center paid $932,800 of principal in FY2020 as its long-term debt continues to decrease. The Medical Center continues to maintain a strong financial position despite the adverse impact from COVID 19. This strong financial position allows the Medical Center to continue to have one of the lower tax levy rates of all county hospitals in the state. Myrtue Medical Center continues to be in the financial position to meet the healthcare needs of the community it serves.

A copy of the audit report will soon be available for review in the office of the Auditor of State and the Hospital Chief Executive Officer's office.