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Agenda (Regular and Consent) Hospital Authority Board AGENDA (REGULAR AND CONSENT) HOSPITAL AUTHORITY BOARD OF TRUSTEES AND UNIVERSITY BOARD OF TRUSTEES August 8, 2019 MEDICAL UNIVERSITY HOSPITAL AUTHORITY (MUHA) REGULAR AGENDA Board of Trustees Meeting August 8, 2019 8:30 a.m. Colcock Hall Boardroom Members of the Board of Trustees Mr. Charles W. Schulze, Chairman Dr. Richard M. Christian, Jr. Dr. James Lemon, Vice‐Chairman Dr. Paul T. Davis Ms. Terri R. Barnes Dr. Donald R. Johnson II The Honorable James A. Battle, Jr. Ms. Barbara Johnson‐Williams Mr. William H. Bingham, Sr. Dr. G. Murrell Smith, Sr. Dr. W. Melvin Brown III Mr. Michael E. Stavrinakis Dr. Henry F. Butehorn III Thomas L. Stephenson, Esq. Dr. C. Guy Castles III Dr. Bartlett J. Witherspoon Trustees Emeriti Mrs. Margaret M. Addison Mr. Allan E. Stalvey Dr. Stanley C. Baker, Jr. Dr. Charles B. Thomas, Jr. Dr. Thomas C. Rowland, Jr. Dr. James E. Wiseman, Jr. Item 1. Call to Order‐Roll Call. Item 2. Secretary to Report Date of Next Meeting of the Medical University Hospital Authority (MUHA) and Medical University of South Carolina (MUSC) Board of Trustees. Regular Meeting: Friday, October 11, 2019. Item 3. Approval of the Minutes of the Medical University Hospital Authority Board of Trustees and the Medical University of South Carolina Board of Trustees Regular Meeting of May 17, 2019, Special Called Meeting of June 28, 2019, and Facilities Subcommittee Meeting of July 11, 2019. Board Action: MUHA Board of Trustees Regular Agenda August 8, 2019 RECOMMENDATIONS AND INFORMATIONAL REPORT OF THE PRESIDENT OLD BUSINESS: NEW BUSINESS: Item 4. General Informational Report of the President. Statement: Dr. David Cole, President, will present a general report. Recommendation of Administration: That this report be received as information. Board Action: Item 5. Other Business. OPERATIONS, QUALTY AND FINANCE COMMITTEE. CHAIRMAN: DR. G. MURRELL SMITH, SR. OLD BUSINESS: NEW BUSINESS: Item 6. Medical University Hospital Authority (MUHA) Status Report. Statement: Dr. Patrick Cawley, CEO, MUSC Health, will present the MUHA status report. Recommendation of Administration: That this report be received as information. Board Action: Item 7. Medical University Hospital Authority (MUHA) Financial Report. Statement: Ms. Lisa Goodlett, Chief Financial Officer, will present the MUHA financial report. Recommendation of Administration: That this report be received as information. Board Action: MUHA Board of Trustees Regular Agenda August 8, 2019 Item 8. Fiscal Year 2020 Budget for the Medical University Hospital Authority (MUHA). Statement: Ms. Lisa Goodlett, Chief Financial Officer, will present the Fiscal Year 2020 Budget for approval. Recommendation of Administration: That the Fiscal Year 2020 Budget be approved. Board Action: Item 9. Quality and Patient Safety Report. Statement: Dr. Phillip Warr, Chief Medical Officer, will present the Quality and Patient Safety report. Recommendation of Administration: That this report be received as information. Board Action: Item 10. Other Committee Business. CONSENT AGENDA ITEMS FOR APPROVAL: Item 11. Appointments, Reappointments and Delineation of Privileges. CONSENT AGENDA ITEMS FOR INFORMATION: Item 12. MUSC Physicians Update. Item 13. Medical Executive Committee Minutes. Item 14. Contracts and Agreements. PHYSICAL FACILITIES COMMITTEE. CHAIRMAN: MR. WILLIAM H. BINGHAM, SR. OLD BUSINESS: NEW BUSINESS: Item 15. MUHA Facilities Procurements/Contracts for Approval. Statement: Mr. Greg Weigle, Chief Facilities Officer, will present procurements/ contracts for approval. MUHA Board of Trustees Regular Agenda August 8, 2019 Recommendation of Administration: That these procurements/contracts be approved. Board Action: Item 16. MUSC Facilities Procurements/Contracts for Approval. Statement: Mr. Greg Weigle, Chief Facilities Officer, will present procurements/ contracts for approval. Recommendation of Administration: That these procurements/ contracts be approved. Board Action: Item 17. Other Committee Business. CONSENT ITEMS FOR INFORMATION: Item 18. MUHA FY2019 Active Projects >$250,000. Item 19. MUSC FY2019 Active Projects >$250,000. Item 20. MUHA Facilities Contracts Awarded. Item 21. MUSC Facilities Contracts Awarded. SHAWN JENKINS CHILDREN’S HOSPITAL COMMITTEE. CHAIRMAN: MR. MICHAEL STAVRINAKIS OLD BUSINESS: NEW BUSINESS: Item 22. Other Committee Business. AUDIT COMMITTEE. CHAIRMAN: THOMAS L. STEPHENSON, ESQ. OLD BUSINESS: NEW BUSINESS: MUHA Board of Trustees Regular Agenda August 8, 2019 Item 23. Strategic Risk Update. Statement: Ms. Reece Smith, Director of Strategic Risk Assessment, will give an update. Recommendation of Administration: That this report be received as information. Board Action: Item 24. Report of the Office of Internal Audit. Statement: Ms. Susan Barnhart, Director of Internal Audit, will report on the activities of the Office of Internal Audit. Recommendation of Administration: That this report be received as information. Board Action: Item 25. Management Development and Compensation. Statement: Discussion of FY2019 performance and compensation will take place. Board Action: Item 26. Other Committee Business. OTHER BUSINESS FOR THE BOARD OF TRUSTEES: Item 27. Approval of Consent Agenda. Statement: Approval of the consent agenda is requested. Recommendation of Administration: That the consent agenda be approved. Board Action: Item 28. Executive Session. Statement: Upon proper motion and vote, the Board may convene a closed session pursuant to SC Code Ann. §30‐4‐70. Although the Board will not vote on any items discussed in closed session, the Board may return to public session to vote on items discussed. MUHA Board of Trustees Regular Agenda August 8, 2019 Board Action: Item 29. New Business for the Board of Trustees. Item 30. Report from the Chairman. MEDICAL UNIVERSITY HOSPITAL AUTHORITY (A Component Unit of MUSC) Interim Financial Statements June 30, 2019 FASB Reporting: Statements of Revenue, Expenses and Changes in Net Position (SRECNA) - Comparative Variance Analysis: Charleston - Management Comments 2 Charleston 4 Florence 5 Marion 6 Mullins Nursing Home 7 Lake City Imaging Center 8 Lancaster 9 Lancaster Imaging Center 10 Chester 11 Chester Nursing Home 12 Consolidated 13 Statements of Net Position: Charleston - Management Comments 14 Charleston 15 Consolidated 16 GASB Reporting: SRECNA - Comparative Variance Analysis: Charleston 17 Florence 18 Marion 19 Mullins Nursing Home 20 Lake City Imaging Center 21 Lancaster 22 Lancaster Imaging Center 23 Chester 24 Chester Nursing Home 25 Consolidated 26 Supplemental Schedules - MUHA CHARLESTON: Charleston - Statements of Revenues, Expenses and Changes in Net Position 27 Charleston - Schedules of Functional Expenses 28 Charleston - Schedule of Revenues and Expenses - Actual vs Budget 29 Charleston - Schedule of Functional Expenses - Actual vs Budget 30 Charleston - Schedule of Functional Expenses - Actual vs Budget Variance Notes 31 Unaudited - For Management Use FASB Reporting: MEDICAL UNIVERSITY HOSPITAL AUTHORITY Notes to the Interim Financial Statements Statement of Revenues, Expenses, and Changes in Net Assets: YTD June 30, 2019 and 2018 (Unaudited) Actuals Compared to Budget The Authority’s June 2019 operating income was above budget by $595,530 on a FASB basis. The roll-forward comparison below displays the major drivers of this favorable variance. Budg et Actual YTD June 2019 YTD June 2019 Operating Income $ 46,799,777 $ 47,395,307 Revenue $70.9 million total variance Adjusted Discharges (2,501,426) Inpatient Surgeries (5,313,462) Outpatient Surgeries 5,850,684 Transplant Procedures 8,748,132 Case Mix Index 1.93 23,781,920 2.00 Prior Year Cost Report Settlement 12,272,074 Retail Pharmacy (net of expenses) 15,074,348 Hampton State Appropriation 2,526,080 Innovation State Appropriation 5,750,000 Other Revenue 13,055,112 Expenses $70.3 million total variance Salaries and Benefits (volume adjusted) (Fav.) Unfav. FTE/AOB CMI FTE/AOB CMI FTE per AOB CMI Adjusted 3.04 (9,856,701) 2.95 Salaries and Benefits rate variance 16,096,533 Premium Pay Overtime 2,001,068 TERI payout 1,034,056 Pension pickup (17,360,472) OPEB hit 9,527,791 Medical Supplies (explained by volume) 1,183,183 Medical Supplies (not explained by volume) 27,127,827 Physician Services 14,473,356 Purchased Services 22,992,429 Depreciation (1,225,944) Utilities, Insurance, Leases, Other Supplies (4,487,901) Revenue Explanation: June year-to-date adjusted discharges were below budget by 0.3%. However, inpatient surgeries, outpatient surgeries, transplant procedures, and Case Mix Index were over (under) budget by (1.1%), 5.5%, 13.4%, and 3.9%, respectively. Additionally, retail pharmacy is favorable on a net basis (revenues less expenses) by $15.1 million. Finally, charity care and bad debt expenses were $5.6 million favorable to budget. Expense Explanation: Our FTE per Adjusted Occupied Bed – Case Mix Adjusted was favorable to budget by 3.9%, which equates to 114 FTEs or $9.9 million. Additionally, year-to-date agency staffing and premium pay overtime are unfavorable by $4.5 million. On a volume adjusted basis, medical supplies exceeded budget by $27.1 million. Physician services and purchased services combined were $37.5 million unfavorable to budget, mainly due to Resident Program, College of Medicine support, information solutions project expenses, and lower results from our operational improvements for purchased services and clinical variation. Utilities, Insurance, Leases and Other supplies were $4.5 million favorable mainly due to lower minor equipment purchases
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