Nashville General outlines budget shortfall as mayor’s subsidy recommendation trims request

Joseph Webb, chief executive officer of Nashville General Hospital, and Bruce Naramore, the hospital’s chief financial officer, told the Hospital Authority Board on a budget hearing that the hospital can operate under the mayor’s recommended $59,550,000 support level for 2025 but only with “a good bit of pain.”

“Our initial 2025 budget and support request was … $63,800,000,” Naramore said, while noting the administration’s recommendation of $59.55 million represents roughly a 3% increase over 2024. He said one-time supplemental payments — including about $3.5 million from TennCare managed-care organizations in 2024 — materially improved last year’s results but will not recur.

The hospital presented a projected revenue picture showing roughly $152.4 million in total revenue under the mayor’s threshold and described remaining cost pressures: physician hiring to replace departing faculty, rising salary expenses and high contract labor costs. “Contract labor costs in 2019 were $2,000,000. For the year we’re in, they’re projected at $13,200,000,” Naramore said, calling contract staffing the largest financial challenge.

Naramore told council members that roughly $2.4 million of the city subsidy is consumed by legacy pension obligations tied to previously owned long-term facilities at Bordeaux and Knowles. He also flagged a roughly $1.3 million per year private security contract adopted after sheriff-provided security funds were shifted away, and a building lease that he said runs about $4 million annually.

Webb emphasized service metrics and the hospital’s mission as a safety-net teaching hospital: average inpatient daily census in the mid-40s, about 2,500 emergency visits per month and roughly 4,000 clinic visits per month across locations. He described efforts to attract more insured patients and to expand services, including recent physician hires.

Board members pressed for more detail on specific budget lines. Councilwoman Toombs asked why capital and repair costs remain in the operating budget and whether items could be moved to the city’s 4% capital fund; Naramore and Webb said accounting rules distinguish repairs from capital projects and agreed to provide an itemized list of the deferred $20 million capital needs for further review.

The CFO said that under the mayor’s recommended subsidy the hospital would still face an approximate $320,000 operating loss and would need to generate nearly $4 million more in net patient revenue to balance without additional support. Webb and Naramore said they are pursuing cost reductions — for example trimming consultant and interim staffing spending — and expect modest additional revenues from anticipated clinical trials and restored graduate medical education (GME) payments if roster issues are resolved.

The hearing recessed with board members asking follow-up questions and the committee scheduling continued budget hearings the next day.