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Carilion Clinic weathers economic downturn with sharp drop in assets

Chief Financial Officer says the company's financial position remains strong

July 22, 2010|Joe Dashiell | Reporter

ROANOKE, Va. — 2009 was a tough year for Carilion Clinic. Net assets declined by almost 30 percent, a decrease of about 235 million dollars, but Chief Financial Officer Don Lorton says the health system's financial position remains strong.

Lorton says there were two factors at work: costs related to the transition from a hospital system to a clinic, and a huge decline in the value of Carilion's investments.

"We anticipated the decline in earnings as a result of that," Lorton told News7. "I don't think anybody anticipated the economy that we've had for the past two years."  He insists the financial challenge will not affect patients or Carilion employees.

"Our pension is still very well funded," Lorton said. "We have adequate operating reserves. In fact we still have over 600- million of operating cash reserves, so there is no issue there."

Lorton says the outlook is beginning to improve. Barring a double dip recession and another plunge in the stock market, Lorton expects Carilion to return to profitability in 2012.

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