A day after telling a University of Arkansas trustees committee of a nearly $29 million projected deficit at UAMS, Chancellor Dr. Dan Rahn outlined some strategies to reduce it and said layoffs are not "currently" planned.
"Our goal is to avoid layoffs," he said before a presentation at Friday's full meeting of the board of trustees at the Little Rock hospital. "We're not currently planning layoffs. But with restructuring and cost-savings measures, we will likely see some positions go away and new ones created. And if we are not successful in achieving these goals, then we would have to take stronger measures."
Rahn said the $29 million figure reflects the deficit if UAMS took no steps, adding the "positive financial impact of newly-insured patients" could reduce it by up to $9 million and cost-controlling measures and efficiencies could further reduce it.
"The financial projections that I showed you yesterday are not what's going to happen," Rahn told the board. "Those projections are what would happen without a significant change in course and without the insurance expansion through the insurance exchange created by the federal Affordable Care Act and by the private option insurance expansion for the Medicaid population adopted by the General Assembly here in Arkansas last year."
Newly insured patients had been projected to bring in upwards of $14 million, but Rahn said Friday that that figure was "overly optimistic." Still, the reduced $9 million projection will help the situation, he stressed.
"We will see new revenue associated with care of patients who are newly insured," he said. "And that's about a third of the problem. It's not insignificant."
Rahn added that UAMS' problems are "compounded to some extent by the large number of uninsured patients in the state of Arkansas and by our heavy reliance on patient-care revenue."
He said UAMS can have a balanced budget by the end of the next fiscal year.
"But we will almost certainly require assistance with our state appropriations in the future," he said. "And we have to undergo significant change internally as our external environment changes."