By Clyde Noel

El Camino Hospital CEO Lee Domanico reports strong hospital performance for the month of October.

The statement of operations for the El Camino Hospital District and affiliates showed strong returns for the month of October. According to Lee Domanico, chief executive officer for the district, it was one of their better months.

With a total operating revenue of $22,843,809 and expenses at $21,118,014, the net income for the month of October was $1,725,796 leaving a net operating margin of 7.6 percent. Year to date the operating margin is 7.2 percent, higher than the previous year.

Because ECH carries no debt with its related interest expense, it can maintain its high operating margin. This will change when the district goes for private financing in the spring to float the recently approved $148 million bond issue to build a new hospital tower.

“We are in good shape for the private financing,” Domanico said.

The industry has established medians to qualify for an A+ bond rating, published by Standard & Poor for stand-alone hospitals. Most El Camino Hospital District financial indicators point toward or exceed the median established for an A+ bond rating.

ECH indicators that exceed the median are: net margin of 12.2 percent lower than prior year’s end but higher than the A+ bond rating criteria; cash on hand, which measures the number of days the district could meet its average daily operating expenditures from cash reserves; and current cash reserves which total $239.7 million, significantly above the A+ bond rating criteria.

On the negative side, the current average daily census is unfavorable as census volumes are lower than budgeted. Average daily census is lower than both the prior year and A+ hospitals.

The monthly summary of financial operations was presented to the board Dec. 3 and approved unanimously.