By Tiffany Green


Cullman Regional Medical Center president and CEO Jim Weidner presented the third annual State of the Hospital address to members of the community Thursday afternoon at a hospital luncheon.

“The economic tsunami has had an impact on the hospital’s bottom line,” Weidner said. “I’m happy to report that after seven months of losses, the hospital made money for the last four months.”

He reported on four main areas of the hospital: Patients satisfaction, quality, employee moral and financial return.

“We are in the top 15 percent nationwide with patient’s satisfaction,” he said.

This is determined by surveys conducted by patients seen at CRMC.

“It does represent a fair population of our patients about their experiences,” he said. “Our community has told us that we received an A.”

Weidner reported CRMC is in the seventh percentile in quality measures as measured through Medicare.

“We have won awards for most wired hospital and were in U.S. News and World Reports as top 100 hospitals,” he said. “We got an A in quality.”

The scoring for employer morale was a bit lower, Weidner said in part due to the fact they were unable to give the three percent raise to employees.

“The main reason is we had budgeted to give everyone a three percent raise, but due to financial situation, we have been unable to,” he said.

He added he is grateful to all department directors for the constant support given to employees to raise morale.

Weidner also discussed the financial debts of the hospital.

“If you want to know what keeps a CEO up at night, it is knowing the hospital is 70 million in debt,” Weidner said.

Weidner said most of this debt is from when he took over three years ago as they separated from Baptist Health Systems. He said the hospital had to pay Baptist Health Systems 50 percent. Due to a confidentially agreement signed by both parties in 2005, the exact terms of the agreement are not public.

He said the public holds 20 million in bonds issued in 1993 and another 50 million to Merrill Lynch, which was refinanced in the Fall of 2007 to get a better interest rate.

“Both parties want to make sure this hospital pays them their interest,” he said.

Weidner said the hospital is self sufficient and they have never borrowed from the city or county.

CRMC does get $400,000 from the city and county each year. This was a statute passed in 1973 to help cover the cost of indigent care. At that time, it did sufficiently cover the cost, however that was more than 30 years ago and costs have risen, Weidner said.

“The $400,000 is earmarked for this hospital,” he said. “It has ballooned over 20 million, but we still get only the $400,000.”

Weidner gave the analogy if the fiscal year was to start on January 1, the $400,000 would be used up by 2 p.m. on January 2.

“We are proud to say we don’t want a hand-out from the community and we can stand on our own,” he said.

“The economy has taken it’s toll on CRMC and the operating margin is in the red,” he said.

A lot of the economic situation is due to bad debt write-offs, or patients with no insurance and interest income, Weidner said.

“We did not have to change our interest and that’s good risk management on our debt,” he said. “Our investment dividends went down.”

Weidner does not see the bad debt write offs improving.

“Unfortunately, it’s only going to get worse in 2009 because more people are going to come to the hospital with no insurance,” he said.

Another reason for debt is the current Medicaid crisis. The hospital was not paid by Medicaid in August and September due to short falls in funding.

“Hopefully the stimulus package will provide some relief,” he said.

Weidner said the cost reduction plan which was implemented in last September is slowly improving things.

The plan included a reduction in staff, a wage freeze, lowered benefits cost, a reduction in supply expenses and a consolidation of departments.

So far the plan has saved 4.4 million dollars and there is still a total of 2.6 to go, Weidner said.

“We know it’s going to get worse and we will continue to tighten our belt,” he said.

Weidner said CRMC is needed in the area.

“If this hospital did not have continued financial stability, it would be catastrophic for this community,” he said. “Our community counts on us.”

He also discussed the upcoming hospital expansions. Professional building three and emergency room expansions will soon be seen at the campus.

“POB III is a 13.5 million dollar project, but with no money from the hospital. It is all by private investors,” he said. “We will try to contract work out from the Cullman area to stimulate our local economy,” he said.

The Golden Window Campaign for the ER department has raised more than 4.2 million to date, with the goal being 5 million.

‰ Tiffany Green can be reached by e-mail at or by telephone at 734-2131, ext. 221.

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