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Riverland Medical Center, now operating in a new facility under a new name – Trinity Medical -- had “total assets of $74,747,050, total liabilities of $66,850,303, and net position of $7,896,747” for the fiscal year ending September 30, 2020.

That’s according to an audit released Monday by the Louisiana Legislative Auditor.

EideBailley of Dubuque, Iowa, is the hospital’s certified public accountant. The firm noted that in its opinion the financial statements  “present fairly, in all material respects, the financial position of the Medical Center as of September 30, 2020 and 2019, and the results of its operations, changes in financial position, and its cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America.”

According to the financial report:

“The statement of revenues, expenses, and changes in net position for the year ended September 30, 2020, indicates total net patient service revenue of $15,097,764, which decreased 4.26% over the previous fiscal year, other operating revenues of $2,465,189, and total operating expenses of $17,898,135, which increased 0.76% over the previous fiscal year, resulting in a loss from operations of $335,182. A net non-operating gain of $213,364 and capital grants and contributions of $2,864,347 brings the increase in net position to $2,742,529.”

Additionally, the reported noted that the hospital “current assets exceeded its current liabilities by $9,289,863 at September 30, 2020, providing a current ratio of 2.21. The Medical Center's current liabilities exceeded current assets by $4,051,430 at September 30, 2019, providing a current ratio of 0.68. The Medical Center's current assets exceeded its current liabilities by $3,524,062 at September 30, 2018, providing a current ratio of 2.69.”

Total assets for the 2020 fiscal year increased approximately $24,090,000 compared to $40,166,000 during fiscal year 2019, noting, “These changes were due in large part to changes in construction in progress, assets in connection with the New Market Tax Credits Program and CARES Act Provider Relief and Paycheck Protection Program funds received.”

The report says that the medical center “derives the majority of its total revenue from patient service revenue. Patient service revenue includes revenue from the Medicare and Medicaid programs and patients, or their third-party payers, who receive care in the Medical Center's facilities. Reimbursement for the Medicare and Medicaid programs and the third-party payers is based upon established contracts.

“The difference between the covered charges and the established contract is recognized as a contractual allowance. Other revenue includes medical records revenue, sales tax revenue and home health joint venture payments.”

In the fiscal year 2020, the hospital’s total net capital assets increased $26.8 million due to the “increase in construction in progress. Construction in progress increased due to incurring expenses related to the construction of the new replacement hospital.

“The Medical Center's noncurrent portion of long-term debt was approximately $59,186,000 and $32,989,000 at end of fiscal years 2020 and 2019, respectively. The current portion of long-term debt was approximately $70,000 and $8,869,000 for fiscal years 2020 and 2019.

“At year end the Medical Center owed $76,000 and $112,000 on Certificate of Indebtedness 2012 Series and Series 2019A Revenue Bonds, respectively. The additional debt was incurred through draws on the Series 2019A Revenue Bonds to pay expenditures related to the construction of the new hospital, Concordia Hospital Foundation owed $27,670,000 on debt transactions to access additional funds through the New Market Tax Credits Program. Current portion of long-term debt outstanding represents .09% of the Medical Center's total assets at September 30, 2020, as compared to 17.5% in 2019.”

The report says the hospital received $3.9 million from the CARES Act (Coronavirus Aid, Relief, and Economic Security Act Provider Relief Funds) and $98,238 through the Paycheck Protection Program and Health Care Enhancement Act.

According to the audit, “The Medical Center was granted a $1,800,000 loan under the Paycheck Protection Program (PPP) administered by a Small Business Administration (SBA) approved partner. The loan is uncollateralized and is fully guaranteed by the Federal government. The Medical Center is eligible for loan forgiveness of up to 100% of the loan, upon meeting certain requirements. The Medical Center has recorded a note payable and will record the forgiveness upon being legally released from the loan obligation by the SBA. No forgiveness income has been recorded for the year ended September 30, 2020. The Medical Center will be required to repay any remaining balance, plus interest accrued at 1%, in monthly payments commencing upon notification of forgiveness or partial forgiveness.”

There were two findings:

2020-001 Preparation of Financial Statements Material Weakness Criteria: “The Medical Center does not have an internal control system designed to provide for the preparation of the financial statements, including the accompanying footnotes and statement of cash flows, as required by GAAP  … We recommend that management continue reviewing operating procedures In order to obtain the maximum internal control over financial reporting possible under the circumstances to enable staff to draft the financial statements internally. Management should also incorporate a process for estimating the current year estimated settlements and analyzing settlements for open cost report years.”

Hospital management agreed with the finding.

2020-002 Segregation of Duties Significant Deficiency Criteria:“The limited number of office personnel prevents a proper segregation of accounting functions necessary to assure optimal internal control … the Medical Center should continually review its internal control procedures, other compensating controls and monitoring procedures to obtain the maximum internal control possible under the circumstances.”

Management agreed with the finding, according to the report.

Hospital board members for the fiscal year ending September 2020 included Jim Graves (chairman), Fred Butcher, Fred Marsalis, James King, Dr. Kevin Ingram, Cherie Lipsey and Randy Hoggart.

Sam Ellard was chief executive officer during the past fiscal year. He was paid $249,379, including $215,115, salary; $10,756, retirement; and $23,508, reimbursements.

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