RALEIGH — WakeMed’s board of directors said Wednesday it expects the regional healthcare system to break even financially in the 2014 fiscal year as the organization comes off one of its worst financial years in its 53-year history.
Raleigh-based WakeMed, which just dismissed its CEO amid intensifying financial pressures, is looking for an interim chief executive and also conducting a national search for a permanent leader.
Tom Gettinger, WakeMed’s chief operating officer, will lead the hospital system while a search for an interim CEO is conducted. WakeMed has also hired Doug Vinsel, former chief operating officer of WakeMed and recent CEO of Duke Raleigh Hospital, to advise the interim CEO once he or she is appointed.
On Tuesday evening, WakeMed’s board of directors adopted a 2014 operating budget with a combined net income of $19.1 million and a “breakeven operating margin.” Net income includes investments and other non-core functions, whereas operating income or operating loss represents the financial health of the organization itself.
WakeMed reported a $15 million operating loss in the quarter that ended June 30, and could post its first annual loss in many years for the 2013 fiscal year, which ended Sept. 30.
Last week, WakeMed removed CEO Bill Atkinson after 10 years at the helm, citing differences in the future direction of the organization.
“We anticipate the next couple of years to be both challenging and filled with opportunities for health systems across North Carolina and the country, and WakeMed is no exception,” said Mike DeVaughn, WakeMed Chief Financial Officer, in a statement.
“We have been fortunate to maintain a positive bottom line for many years, and our strong financial position will allow us to successfully withstand this time of transition in healthcare,” DeVaughn said.
WakeMed is the largest hospital system in Wake County, with 8,500 employees and 870 beds, as well as clinics and offices throughout Wake and in Johnston County.
The past several years have been tumultuous for WakeMed, and have included its aborted hostile takeover attempt of crosstown rival Rex Hospital, and a federal investigation into WakeMed’s Medicare billing practices. This year the organization warned of disruptive changes in the healthcare market and announced the elimination of 100 jobs.
WakeMed, like other hospitals, faces reduced Medicare reimbursements from the federal government and fines for excessive readmissions of Medicare patients.