*The board approved its 2005 budget, which estimates a profit of $1.07 million for the Paynesville Area Health Care System. The budget calls for an average seven percent price increase at the clinic and expects a two percent volume increase for the hospital and clinic. PAHCS also plans to spend $1 million on capital expenditures in its 2005 fiscal year, which runs from Oct. 1, 2004, to Sept. 30, 2005. (See related story)

*The board was informed that PAHCS has paid its operating line of credit. Thru 11 months of its 2004 fiscal year, PAHCS has recorded a profit of $1.129 million. PAHCS now has cash on hand and no longer is borrowing on a line of credit for operations. Ending that line of credit has been a management goal of PAHCS this year.

*The board approved a new three-year contract with the doctors of the Paynesville Medical Group. The physician-hospital organization agreement since 1994. Previously, contracts lasted for five years, but a three-year contract was used this time. The agreement calls for compensation to be reviewed annually and will compensate doctors for emergency room coverage.

*The board appointed James Mohs, M.D., (C-section privileges) and Larry Okerlund, M.D., (C-section privileges) to the medical staff, each having completed their provisional period. Both are part of a pool of on-call physicians that PAHCS can utilize for C-sections.