Hershey, Pa. -- Despite uncertainty about the future of state and federal funding for medical education, declining reimbursements from Medicaid, a national shortage of health-care workers and a need for physical space to support its growing education, research and patient-care missions, Penn State Milton S. Hershey Medical Center is in on track to meet its budget goals for the current fiscal year.
Darrell G. Kirch, senior vice president for health affairs, dean of Penn State College of Medicine and Penn State Hershey Medical Center chief executive officer told the Penn State University Board of Trustees today (March 18) that the medical center has experienced substantial growth in patient volumes over the past year, showing a 1 percent increase in emergency room visits, a 6 percent increase in outpatient clinic visits, a 9 percent increase in hospital admissions, and an 18 percent increase in the number of surgical cases.
During the month of February, the hospital occupancy rate for adult patients averaged 100 percent. The average occupancy rate for pediatric patients (patients under age 18) was 96 percent.
"As the only university teaching hospital, children's hospital and research center located between Philadelphia, Pittsburgh, Baltimore and Rochester, we serve a significant population with substantial medical needs," Kirch explained to trustees. "More than ever, those patients and their families are turning to Penn State Hershey Medical Center for care. The burning question is whether we can continue to ward off the many challenges that threaten to interfere with our ability to meet their needs."
The high patient volumes have enabled the medical center to meet its budget through the first eight months of the fiscal year -- a $10.7 million positive bottom line versus a budgeted bottom line of $10.6 million through February -- but a need to invest in medical technology, address the demands of limited physical space, recruit and retain the best health-care workers, as well as provide continued support for the College of Medicine quickly will absorb any margin at the end of the year, Kirch cautioned.
Penn State College of Medicine, which ranks last in the nation in state support for medical schools, relies heavily upon the medical center's clinical revenues to support its education mission. PSCOM receives less than $5 million annually from the commonwealth for medical education. The average public medical school in the U.S. receives approximately $50 million in state funding.
The College of Medicine produces more primary physicians who stay and practice in Pennsylvania than any other medical school. An economic impact study produced by Pittsburgh-based Tripp Umbach Healthcare Consulting Inc. shows that PSCOM graduates practicing primary care in Pennsylvania saved $28 million in unnecessary emergency room care and in-patient hospitalizations in 2002. The College of Medicine is poised to increase its medical school class size from 135 to 145 in fall of 2006 but again, Kirch noted, space is a concern.
"We are responding to the growing demand for health-care professionals by increasing our class size," stated Kirch. "An increased student population, however, means an increased need for classrooms, computers, and housing."
Research funding, which exceeded $98 million in 2004 and is up from $54.5 in 2000, also shows continued growth, Kirch told trustees. The number of research dollars awarded exceeds last year's total by more than 3-and-a-half percent. Overall annual research funding is on pace to exceed $100 million for the first time in medical center and College of Medicine history. This year, the organization is relocating some work units out of the main hospital and college building to make 30,000 square feet of research space available for investigators.
The medical center also is renovating space on the hospital's fourth floor to bring an additional 14-bed inpatient unit online by June, but more beds will be necessary to keep pace with growth in-patient volumes. Design work has begun on a new Penn State Cancer Institute facility, but the building is not likely to be completed for three or four years and while fundraising for a new Penn State Children's Hospital is progressing well, a design and construction timeline for the building has not been set. In the meantime, Kirch told trustees the medical center and College of Medicine are doing everything possible to meet the demands of growth.
"Success has its challenges and we are growing at a greater rate than we could have anticipated," Kirch told trustees. "We have gone to great lengths to identify underutilized space in all of our facilities, we have set metrics to analyze whether we are getting the maximum possible use out of each square foot on our campus, and we have begun to ask people to move, in some cases to leased space off-campus, in order to meet our growing needs. To some extent the process has been difficult for our staff but we recognize some discomfort is necessary in order to meet the present and future needs of our patients."
Founded in 1963 through a gift from The Milton S. Hershey Foundation, Penn State Milton S. Hershey Medical Center is one of the leading teaching and research hospitals in the country. The 461-bed medical center is a provider of high-level, patient-focused medical care. Annually the medical center admits nearly 24,000 patients, accepts more than 700,000 outpatient visits, receives more than 45,000 emergency room visits and performs approximately 21,000 surgical procedures. The medical center campus also includes Penn State College of Medicine, Penn State University's medical school; and Penn State Children's Hospital, the region's only children's hospital.
In 2004, more than 100 medical center and Children's Hospital physicians from nearly 30 specialties were chosen for inclusion in Best Doctors in Americaî, a nationally-recognized database that contains the names and professional profiles of doctors chosen through an exhaustive peer-review survey in which thousands of physicians are asked to name the best clinical practitioners in their specialties.