Increases in patients and revenue at FCH
Is the Fulton County Hospital rebounding from a loss of patients and revenue that began when the White River Medical Center opened its new emergency room at Cherokee Village in Sharp County last summer?
Board members learned at their Monday, Jan. 26, meeting that financial numbers improved for the second month in a row.
December financial report
"We had a pretty good month in December," board chairman John Ed Welch reported. Net income was in the black at $40,000, cash increased by $87,000 and ambulance runs appear to have leveled off after several months of declines.
The in-patient census was 6.29, up from 5.63 in November, and thanks to the cold and flu season the hospital expects an increase in patients in January. "We had 19 [in-patients] this morning [Jan. 26], and we've been averaging about 20 a day," administrator Charles Willett reported. One other good sign is, the financial report showed emergency room visits, which plummeted when the Sharp County e-r opened, were 419 in December, compared to 384 in November.
Hospital finances took a big dive in November when the hospital had to pay $400,000 to Medicare to reimburse for overpayments, bringing the loss for the first five months of the new fiscal year to more than $564,000.
"That almost wiped out most of our cash on hand for a period of time. We had 28 days of cash on hand in Dec. 2013, and were down to just 11 days cash on hand [in November 2014]. We're up to 15 [days] now so it's a little better," board member Dr. Jim Bozeman said.
Willett said finances should show further improvement since Medicare has raised the daily amount it pays per day for each Medicare in-patient by $415.
One problem is Days in Accounts Receivable, the number of days it takes to submit Medicare and Medicaid and private insurance claims for payment. It remains at 73 days, instead of the budget goal of 65. The larger number of days usually indicates delays by physicians in completing paperwork so claims can be billed. "Are physicians getting their charts [backlog] down? board member Neesha Barker asked. "Yes," Willett replied. "There is considerable money there [not being billed]," Barker stated. "I don't have the total [number of unfinished patient charts] but it is way down," Willett said. "It's money we can't get [unless it is billed]," Barker added.
Most of the rest of the discussion at the meeting regarded a proposal made in December by Harrison Energy Partners to cut the hospital's energy bill by making the heating and air conditioning system work more efficiently. In December, company representative Ben Dye proposed a $62,000 contract, to be paid back over four years, to cut the hospital's $200,000 a year hvac bill by at least three-point-nine percent. Dye later added the company could, likely, cut the bill by another five percent. The board did not act on the proposal in order to take time to go over information submitted by the company.
At the Jan. 26 meeting, board member Bill Pace asked questions about the monthly payment and the amount being financed. Dye, who spoke to the board by speaker phone, was asked to clarify costs, and hospital maintenance supervisor Charles Broyler explained in more detail why the project is needed and what will be done to improve the hvac system.
Broyler explained that a controller hooked to the hvac system controls boilers, humidifiers, dehumidifiers and a big heat and air unit on the roof. The problem is, the current controller does not work properly, because a computer that monitors and works the system has outdated software. Controls that should make the hvac system work more efficiently are not working.
"They [Harrison Energy Partners] are going to put a new controller in and they are going to put in a new computer and software...so it will be able to set a schedule for the whole hospital so we will save money by not heating and cooling areas that don't need to be heated and cooled all the time, Broyler said. "Also, all of our 2 ½ ton units over the old portion of the building, we're using cheap thermostats and running each one individually. They are going to attempt to hook all these units to that controller."
Broyler added the current company which is providing hvac service does not quickly come to the hospital when problems arise, is expensive and has not been good at making repairs.
Dye explained the costs involved in the four year program to repair and monitor the system:
"The monthly payments will be a combination of the controls project which will be financed...the total amount [for controls] is $34,700 and a service agreement in the amount of $27,984 brings the total to $62,684, the total project cost. The monthly payments will be $1,481, approximately. The average monthly savings projected are $1,561.
That breakdown was troubling to Pace and fellow board member Charles Owens in that the hospital would come out with only $80 a month total savings, after paying the company for its services each month.
Willett explained that the energy savings would cover the monthly payment, and Dye had promised to make up the difference in year one if his company did not reduce the hospital's hvac bill by nine percent.
Barker said it sounded like the hospital was going to have to spend at least $34,000 on equipment to get the hvac system working properly and, by paying Harrison Energy Partners $27,984 for a service contract, that will be the total cost, no matter how many times they have to come to repair the system.
Broyler said Harrison Energy has a repair person who lives in the area so response to hvac problems should be much quicker.
"It's a no brainer. I move to accept the contract," board member Rob Long said. After a second was made, all board members present voted to accept the contract with Harrison Energy Partners, except Pace, who indicated he was opposed to the offer.
During the meeting, it was announced that the Fulton County Hospital Foundation is planning to hold its second hospital Gala the first Saturday in November. The first Gala, held in November of 2013, drew a big crowd and raised funds to help the hospital purchase new hospital beds for the in-patient wing. The foundation also plans to hold its annual golf tournament, another major fundraiser, the second Saturday of August.