Administrators at Whidbey General Hospital continue to crunch numbers and make cuts in order to produce a healthier budget for 2003.

A draft shows that the hospital’s budget is balanced, with a slightly more than $1 million left over. But that scant amount has hospital officials worried.

“It doesn’t give us any breathing room at all,” said Doug Bishop, the hospital’s chief financial officer.

Scott Rhine, chief executive officer, said this week a 5-percent margin is necessary so the hospital can introduce and maintain new services to meet the needs of the community and to keep up with inflation. As is, the 2003 budget gives the hospital a 1.9-percent margin.

He added that money also needs to be available to maintain competitive wages in hiring staff.

To increase the budget’s cushion, hospital administration is planning to make several adjustments to increase revenue and will shave some money from various departments throughout the hospital.

Rhine said the cuts should have a minimal effect on patients.

“We’re not trying to eliminate any services,” Rhine said.

He said there will be changes. For example, adjusting scheduling in rehabilitation services could earn the hospital $100,000. Hospital officials are also considering charging a fee for ambulance standby services.

If the changes are approved, more than $650,000 in revenue will be added to the bottom line.

The budget is scheduled for approval at the Feb. 10 meeting of the hospital’s board of commissioners meeting.

Hospital administrators normally approve the budget in December, but have been wrangling with the budget for months due to a technical problem with the hospital’s information systems. The budget was also delayed because the hospital had to reorganize after the loss of 20 employees.

The hospital has been operating within the parameters of the 2002 budget since the beginning of the current year.

To help save money, hospital officials asked a number of employees in November to voluntarily resign. Twenty employees took the offer, saving the hospital between $800,000 and $1 million.

There is some good news in the budget as a 14.4-percent increase in revenues is being forecasted. But with the revenue increase, the hospital is also dealing with a 19.8-percent increase in write-offs. The hospital is expecting to write-off more than $30 million in 2003 compared to $26 million last year. The loss is due in part to declining Medicare and Medicaid reimbursements.

Bishop said that the hospital receives 50 cents for every dollar billed to Medicare and 20 cents for every dollar billed to Medicaid.

He added that Medicaid payments often take 150 days to go through.

“We get paid very little and have to wait a half a year to get it,” Bishop said.

As hospital officials hammer out the final details of the budget, they continue to watch the economy and see how it effects the hospital.

“It could go north or south on us,” Bishop said.

He said other hospitals are dealing with similar problems.

Providence Everett Medical Center recently announced it will cut 350 jobs in a cost-saving maneuver.

In the coming months, Whidbey hospital officials are considering adjusting staffing levels to accommodate patient flow and cash flow.