Official Response to State Auditor’s Report
December 15, 2017 12:42 pm
This article refers to the report captioned “Assessing the Financial Health of Mississippi’s Independent County-Owned Rural Hospitals” produced by the Mississippi Office of the State Auditor. The report was issued on December 13, 2017 and has since run on numerous news outlets throughout our region and state. Magnolia Regional Health Center’s official statement regarding the performance audit is below:
“In response to the assessment of public rural hospitals’ financials by the Office of the State Auditor, we feel like it is important to elaborate on the factors that contributed to Magnolia Regional Health Center’s “poor” financial rating for fiscal year 2016. The Office of the State Auditor based their review on audited financial statements that took into account the effects of regulations mandated by Governmental Accounting Standards Board 68 (GASB 68),” said Ronny Humes, Chief Executive Officer at Magnolia Regional Health Center. “These regulations were initiated in 2014, requiring public hospitals to record on their financials their portion of the unfunded liability of the Public Employees’ Retirement System (PERS). Although these liabilities appear on our financial statements, we have paid all of our contributions required by PERS . Removing the impact of GASB 68, our financial strength index score would reflect an “excellent” score for 2015 and a “good” score for 2016. The decline from fiscal year 2015 to fiscal year 2016 reflects a major information technology upgrade the hospital underwent to better enhance the continuum of care for the patients we serve and to better compete in the changing healthcare arena. We are confident our current financial position will allow us to continue to provide care in Alcorn County and the surrounding region for years to come.”
The below graph reflects the impact GASB 68 has on the financial strength at Magnolia Regional Health Center:
The Mississippi Office of the State Auditor’s official report can be found by visiting the following link:
http://www.osa.ms.gov/documents/performance/Rural%20Hospital%20Assessment%20-%202017.pdf
This post was written by Magnolia Regional Health Center
