This article is over 6 years old

Health & Science

Harris Health System Squeaks Through Fiscal Year, Barely

The public health system for Harris County, which includes Ben Taub and LBJ hospitals, has managed to whittle down a budget deficit and finish its fiscal year in the black.



To embed this piece of audio in your site, please use this code:

<iframe src="" style="height: 115px; width: 100%;"></iframe>

Harris Health had a rough year, but it looks a lot better now that it's over. At the start of the fiscal year that that began last March, board members and executives faced a projected deficit of more than $70 million.

"That was the result of what we call ‘the perfect storm,' explained President and CEO George Masi. "Increased patient volumes, no expansion of Medicaid in Texas — and that had a profound effect on Harris Health — and just the inflationary factors associated with healthcare."

To cope, managers stopped filling vacancies, eliminated raises for most workers, and laid off almost 100 people. The personnel changes alone saved almost $17 million.

Masi said it was painful to do: "These were real people, doing real jobs, with real work."

Managers also found savings in pharmacy, laboratory and supply chain costs.

Masi says strategic streamlining also helped save money. For example, Harris Health is so overwhelmed with cases that managers had been paying other hospitals to perform certain surgeries on its patients. But it stopped that outsourcing last year, and saved more than $7 million from those contracts.

"These are not emergent cases, these are cases like a gallbladder, maybe a hernia repair that could wait, sometimes wait inordinately long times, to be managed," Masi said.

"But we pulled those all back in, and actually just expanded our hours, worked harder, pushed the staff a great deal to get that done, and they did," he added.

Finally, just a few weeks ago, there was what Masi calls a "February Christmas present" — $14 million more in tax revenues than expected.

That eliminated the budget hole, with $1.1 million left over.

"It's like the little train that could," Masi said. "There are not a whole lot of people who thought we could make up that kind of ground. It was a lot of sacrifice, on the part of a lot of folks associated with the organization, that allowed us to make that margin."

But the pressure isn't off yet.

This fiscal year, Masi faces a new deficit of $8 million. Even if he overcomes that, he's not able to save and recapitalize for maintenance, new equipment and growth, he said. Too many years in that state are not sustainable, he said, and so he will continue to push Texas politicians to expand Medicaid using federal dollars.


Today in Houston Newsletter Signup
We're in the process of transitioning services for our Today in Houston newsletter. If you'd like to sign up now, fill out the form below and we will add you as soon as we finish the transition. **Please note** If you are already signed up for the newsletter, you do not need to sign up again. Your subscription will be migrated over.