BRATTLEBORO-Less than two months before the close of its fiscal year, Brattleboro Memorial Hospital is still trying to find enough cost reductions and new revenue to balance its current $119 million budget.
"FY25 has been a financially challenging year," hospital leaders wrote to state health care regulators in a memo shared at an Aug. 6 review hearing. "BMH currently has a comprehensive financial recovery plan in place; however, we are at risk of failing to fully deliver on some of those initiatives."
The hospital, one of Brattleboro's three largest employers, revealed in May it faced a projected $4 million budget shortfall upon the close of its fiscal year on Sept. 30. In response, it launched a hiring freeze and let go of six administrators in hopes of lowering its staff count from 543 this fiscal year to 513 in the one that starts Oct. 1.
Hospital leaders still have work to do.
On Aug. 6, they informed the state that patient volume and revenues were "generally stagnating or decreasing." (Regulators didn't push why, but praised the quality of care.) BMH officials then noted this fiscal year's losses had totaled as much as $9.5 million and unpaid patient bills had risen as high as $38 million.
"We recognize we are in a bad financial condition," Laura Bruno, the hospital's chief financial officer, said during the online hearing. "We have some ways to go."
Hospital President Christopher Dougherty added in a letter to the state: "BMH must produce a positive margin in the fourth quarter of 2025."
BMH is one of Vermont's 14 community hospitals meeting with the state's Green Mountain Care Board this month as regulators study proposed budgets for the 2026 fiscal year.
Brattleboro's 2026 spending plan estimates its total operating expenses will rise $2.3 million, or 1.9%, from the current year's, while revenues could increase enough to project a surplus of $244,000.
While hopeful, the hospital foresees several potential problems.
It is set to lose $14 million next year with the Dec. 31 end of the OneCare Vermont accountable care organization, although it hopes to replace those funds by joining another system.
It could lose $3.6 million if the federal government doesn't extend support from the Medicare Dependent Hospital and Low-Volume Hospital Payment Adjustment programs, and another $700,000 if dropped from a national 340B drug pricing program that offers financial help. And new U.S. tariffs "threaten to dramatically increase our costs for supplies and drugs," it said in its memo.
State regulators will continue to review budgets this week and next before ruling on whether to approve, modify, or deny proposals by Sept. 15.
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This News item by Kevin O'Connor originally appeared in VTDigger and was republished in The Commons with permission.