The meeting began with an update from Administrator Tony Thompson regarding the cost settlement for the 2011 fiscal year. An accounting shows that Medicare and Medicaid underpaid the hospital last year, good news since the accounting could have shown that the hospital was overpaid and owed money to the federal agencies.
"The cost report has been completed and will go in the mail tomorrow (Nov. 27)," Thompson told the board. The amount due the hospital will be larger than thought, if the agencies agree with the report to be submitted.
"That will result in two different checks that will come our way. In about six weeks, we will get a Medicare cost report return. That will be in the amount of $340,000. In about five months, the Medicaid check will be coming our way at $188,000. So about $528,000 (total) in the next five months," Thompson said.
Thompson proposed that top priority be given to paying vendors whose bills have been unpaid the longest. "I would want to address payments to the trades. We're about $265,000 (behind) in our 60 to 90 day category right now," Thompson said. "There is about $126,000 (owed) in our 30 day category." According to Thompson, using $300,000 from Medicare to pay bills would "get us close to paying on term."
Thompson said plans have been finalized to begin an Advocacy Program, which involves the hiring of a private company to try to assist patients who come to the hospital with no insurance or no other means of paying medical bills. Under the program, the advocacy company will evaluate the patients and help those who qualify apply for Medicaid assistance. The company will receive 12 percent of any Medicaid payment it obtains for the hospital, and bring revenue into the hospital which is currently being written off as a bad debt when patients receive treatment but are unable to pay.
Ozarks Medical Center CEO David Zechman, who attended the board meeting, noted that, by negotiating a deal in which the advocacy company will assist "no insurance" patients at OMC and Fulton County Hospital, the advocacy company's pay rate was reduced from 24 percent to 12 percent. "These are folks that can qualify for Medicaid that are currently not on there," Zechman said. "The 12 percent, they (the advocacy company) don't get anything unless they get (patients) on Medicaid, so the hospitals are not out anything."
FCH is moving forward to switching to a new pharmacy distribution company. In another partnership with OMC, the hospital will get its drug supply from a new distributor, and the change will reduce the pharmacy's costs by five percent.
The financial report for the month of October shows that the acute care and swing bed wings both averaged five patients a day, both below the number of patients admitted in the prior year. The biggest increase in patients came from more outpatient visits, which resulted in more lab work ups and observation days. Thompson and Zechman noted an increase in outpatient treatment and a decrease in admissions is a national trend, and not necessarily a good one, because outpatients are the population where most unpaid bills and bad debt come from.
The hospital's operating loss in October was $37,000, which was lower than a budgeted loss of $70,212.
Thompson and board members have noted, in recent months, the vital need to increase inpatient admissions to help stabilize finances, and several ideas for new services to bring patients in have been discussed. But it does not appear that any of the new services are on a fast track.
New services under consideration are a wound care clinic, a diabetes education program to help diabetics improve their health, a new primary care clinic to see patients who do not have physicians and come to the emergency room with issues that are not true emergencies and a possible FCH clinic in Horseshoe Bend.
During the November meeting, Thompson indicated all of the possible new services are still on the drawing board, but none are likely to be implemented unless there is an indication they will quickly attract enough patients to be financially successful.
For example, three providers who specialize in diabetes education have been in talks with the hospital, and feedback indicates there is a need for such a program in the community. The question is, how long would it take for such a program to make money? "We're getting some mixed messages in terms of what the patient volume is," Zechman said. "I think people need it, but is it going to generate the revenue to offset the cost?"
Thompson urged caution before offering any new service. "With our finances the way they are, I just want to be very cautious and make sure we can build the program and not have a negative (financial) impact. There is just so much uncertainty right now in health care reform, what may happen or may not happen, that we need to be cautious."
One big change that is moving forward is efforts to build an Electronic Health Record system. Healthland Inc., the company hired for the project, plans to be working by January to set up the hardware needed for the switch from paper to electronic records.
"We're on track to start our attestation in June as we had planned," Thompson reported. Attestation is implementation of Phase One to show federal agencies the initial stage of the system is working, to allow the hospital to qualify for more federal money to implement Phase Two.
"We're holding meetings, most of them are conference calls, and we have had some onsite meetings. We've had meetings where they have given us homework, charts and things like that to send in."
According to Thompson, a learning lab will soon be set up so that hospital employees can begin learning how to use the new electronic system. The lab will allow employees to sign on and take various online modules, which end in a test to determine whether an employee is proficient in a certain area. Thompson said the learning lab takes a low pressure approach, allowing employees to take a module as many times as needed to become proficient.
Because the board's next regular meeting is scheduled to take place Christmas week, the December meeting has been moved to Dec. 17 at 6:00 p.m. in the hospital conference room. Meetings are open to the public.