PROVIDENCE – Lifespan, the state’s largest hospital network and the state’s largest private employer, has experienced an unspecified financial shortfall during the first five months of its fiscal year beginning Oct. 1, 2012, according to Lifespan spokeswoman Gail Carvelli.
“The financial shortfalls are attributed to a prolonged economic slump in Rhode Island, as well as a number of key factors – downward pressure on our reimbursement rates, a sharp increase in charity care and an increased length of stay for hospitalized patients,” Carvelli said.
In response, Lifespan is asking management, physician partners and frontline staff to review current budgets and recommend expense reductions that will address the current financial shortfall, according to Carvelli.
“It is premature to discuss what cuts will be implemented; however, we will take steps to ensure that they do not compromise patient quality or safety, and we will work hard to minimize the impact on our employees,” Carvelli said.
For fiscal year 2011 (the most recent figures available), Lifespan reported total operating revenue was $1.686 billion, with total operating expenses of $1.681 billion, leaving income from operations of $4.931 million. Thanks in large part to a litigation settlement of $12.2 million, the enterprise posted a net loss in fiscal 2011 of $9.2 million.