By Mary Alice Murphy
At the Friday, Sept. 23, 2016, Gila Regional Medical Center Board of Trustees meeting, during reports and updates, Chief Executive Officer Brian Cunningham gave an update on the Healthy Hospital, Healthy Community mill levy initiative.
The first report was given by the Auxiliary President Frances Day, who thanked the hospital for the recent awards appreciation banquet for Auxiliary volunteers.
"We recognized two members'Charles Mossberg for 25 years of service and Audrey Welsh for 35 years," Day said. "Audrey is now an associate member.
"We still need volunteers," Day continued. "Two-thirds to three-quarters of our membership attended the banquet. It was a treat. We were served by Mr. Cunningham and Angela Ortiz. Amanda (Holguin) did a lot of the organization of the event."
Cunningham said he would like feedback from the board on the Healthy Hospital, Healthy Community presentation that he is giving to community groups and any individual who asks about the 4-mill levy that will be on the General Election ballot. "I have talked to a number of service groups and members of the press and have had feedback. Chairman (Jeremiah) Garcia was at the presentation I gave to Freeport-McMoRan, Trustee (Joel) Schram was at the presentation for the Prospectors, and Vice-Chairman (Magdaleno) Manzanares at the Democratic Party meeting.
Trustee Tony Trujillo said he has received a lot of feedback from senior citizens, especially those who are on fixed incomes. "I would suggest you visit the senior centers."
Cunningham said he would include them in his presentations.
He said bullet point No. 3 in his CEO packet addresses an article about the Alta Vista Hospital in Taos having to drop its obstetrics and gynecology department because of a lack of cash. Women needing the services now have to drive at least an hour to get them.
"It's happening all over the country," Cunningham said. "Our goal is to keep our 4-Star quality close to home. We are the only county-owned hospital left in New Mexico. Some are community-owned by non-profits."
Assistant Vice President of Administration Liana Ryan said the hospital would have clinic analyses the week of Sept. 26. "We are moving forward on contracts for a full-time anesthesiologist, a part-time anesthesiologist and a full-time urologist.
GRMC's Kari Lane said the hospital continues to talk to prospective pediatricians.
Chief Nursing Officer Peggy White said Assistant Vice President of Nursing Wanda True would be retiring soon. "We offered the position to Kelly Rodriguez, who has been GRMC clinical coordinator, and she accepted it."
Cunningham said filling the position was an example of the board's succession program.
Chief Operations Officer Jed Rudd said he wanted to highlight a report from a hospital in Arizona that had a large information breach. "Vendors tell us that our approach is pro-active and, given how rural we are, they are shocked at how far ahead of the curve we are in protecting our data."
To a question by Garcia on the reported savings on equipment, Rudd said he reports to the Quality Improvement Committee the results of savings the hospital finds when upgrading services to less expensive alternatives. "We're working to get that report out to the board and QIC."
Chief of Clinical Services Ray Goellner asked for questions on his report in the packet.
Trustee Dr. Tsering Sherpa noted how many patients had had to be turned away because of the hospital not being able to offer speech therapy quickly. "It was disappointing that we had to send a patient to Deming to get a speech study done. That is an integral service that is missing."
Goellner concurred that there is a backlog of patients, but could not get a timeline as to when it would be fixed.
Cunningham said it is hard to keep up with the demand for speech therapy. "But with the three that are in training, we will have backups, so this won't be happening. The hospital is moving forward with the solution."
Chief Financial Officer Michael Metts reported a loss of $300,000 for the month of August. "We still have 106 days of cash, which compared to other hospitals is excellent. If we consider all New Mexico hospitals the average days of cash is 23 and in rural U.S. hospitals, it is 17."
He said the hospital had added the Humana Medicare Advantage product, so the hospital is in the network for Humana Advantage. "We are also working on the Molina Exchange and Advantage programs, and expect to have them in place within the next 90 days."
Schram asked about the budget variances. "Total gross revenue year-to-date is $2.2 million ahead of budget, yet contractuals are significantly behind budget. Why are we seeing such a variance so early?"
"Overall, when we budgeted, we did so for a basic break even budget on the bottom line," Metts said. "We are seeing, particularly in outpatient services an overall increase in charges, so proportionally, we've had higher charges in the month of August. However, the estimate on the reimbursement, which is on the contractuals, we've had higher contractuals that we posted for the month. This is specifically looking at total reimbursement to charges. We're consistent in our reporting for each month. For the outstanding receivables, we use an estimate of the trending nine-month trailing claims. We look historically at what we've been paid at a high level. As services change and, as we did a charge increase, it is the overall contributing factor to the amount. But services such as Medicare and Medicaid do not pay us any higher. When we did our pricing structure, we figured we would have an estimated approximately $1.5 million favorable to the bottom line by increasing charges. We increased the charges when we found by reviewing other New Mexico hospitals that we were at about 85 percent, so our charge structure was much lower."
He said as time goes on, and as claims get paid, if what is paid is less than the estimate, the variances will become greater.
As the hospital is cleaning up its receivables, "we will recognize that as paid claims change, the history will change," Metts said. "It will start to catch up with itself. Nothing has changed with how we've been booking our estimates for the outstanding receivables." He noted that the budgeted volume for inpatient care is lower proportionally than the outpatient care.
Schram said that overtime the variance should eventually shrink, to which Metts replied: "Yes."
Garcia asked about the trend for days of cash.
"We're doing good with total cash on hand," Metts said. He said the operating balance for the month of August was $70,000, but the overall balance was negative $300,000, which reflects the spend on capital and the spend on the Meditech upgrade.
On average the spend on capital accounted for about 2.5 days this month, and Meditech accounts for about 1.5 days a month. The big-ticket items coming toward the month of December include the repayment for the Safety Care Net Pool, which will be a take back of about $2.6 million or 13 days of cash. The upgrade to Meditech 6 will account for another 10 days, which will equal about 25+ days reduction over the year, depending on operations. He said he would put together a "quick" accounting of the estimated trend.
"We are working with much diligence on the focus on our operations, and whether it is an increase in reimbursements that will ultimately transfer into cash," Metts said. "As we improve our operating margin that will for sure put cash back in." He believes the hospital will do better than the break even point it budgeted for.
Metts also said the fiscal year 2016 came out with the best revenue collection ever for the hospital. "We're appreciative of the efforts going into the revenue side."
Chief of Staff Gregory Koury, M.D., asked for a couple of bylaws changes in rules and regulations to be approved, including creating one electronic form and one paper form with simplified histories and physicals (H&Ps) and a clarification on transferring a patient. The changes were approved. "We are aligning the rules and regulations with the policies," Lane said.
Garcia said the Executive Committee met and discussed and developed the agenda.
Trujillo reported on the Quality Improvement Committee, which he said was a good meeting.
The Finance Committee asked for approval of contracts and recommendations. The first was an addendum to the chief of staff professional services agreement to pay Koury an additional not to exceed $36,000 for the additional hours that he is not being paid for as chief of staff. It was approved.
Trustee Dr. Victor Nwachuku, the past chief of staff, said it was hard to keep a time card, so "a specific amount is better."
The second item to be approved is a physician consulting agreement for the Ongoing Professional Peer Evaluation Committee services by Thomas DeCoster, M.D.
And the final was a contract for Pavel Capek, M.D., as laboratory medical director. The contract is for a year with auto-renewals to 2020.
Schram asked about the auto-renewal and if the hospital has an "out."
Cunningham said clauses in the contract specify termination with or without cause, "and we have a remediation process along the way, if it's needed."
Schram gave the Plant and Facility Committee report on construction and equipment replacements. "We are meeting on the proposed surgery and labor and delivery changes."
Cunningham said the hospital was close to a vendor for architectural services.
Garcia reported on the Human Resource Committee, as Chairman Trujillo was out of town when the group met.
"We have had trouble getting information on why employees leave," Garcia said. "So we talked about how to get that information." He also noted that contract labor for August was high at $546,000. Trujillo asked to what it could be attributed.
"One of the challenges is in the reporting," Controller Elizabeth Allred said. "Not all of the July contracting went on the July report, as the report is done early in the month, so we catch up the next month."
Cunningham said over the year, "it evens out."
The board members took a 15-minute break before going into executive session, but no action was taken in executive session on their discussions or after, when they came back into open session.
The next meeting's regular scheduled date would be October 28.