HOSPITAL BOARD: Medicare/Medicaid expansion needed, hospital prepared for Ebola

Medicare/Medicaid expansion and Ebola preparation were the highlights of the hospital board meeting Oct. 21.

The hospital's auditor, Eddie Marmouget, mentioned that the hospital would “really benefit” from a Missouri vote for Medicaid expansion in lieu of the Affordable Healthcare Act possibly stopping the Disproportionate Share Hospital payments given to SMDH for being a Critical Access Hospital in a medically underserved area.

The areas Marmouget mentioned that board members “really need to hit on with our legislators” due to impending financial risks to the hospital are:

• a federal two percent reduction that’s still in place with the new budget,

• retaining the hospital’s CAH status and the 340B Drug Program,

• and putting pressure on the state to get Rural Health Clinic Medicaid reimbursement settlements dealt with.

The board agreed to $45,000 in consulting fees with BKD, who felt confident that it could bring a return of $440,000 in Medicaid receipts and the 2014 Meaningful Use Flexibility Rule receipts. BKD agreed to waive the fees if it’s wrong.

Cindy Fry, R.N. (Infection Control expert) and Mary Lou Brooks, R.N. (the new Assistant Director of Nursing), caught the board up to speed on the hospital’s Ebola preparedness and demonstrated how to safely take off full-body equipment.

The hospital is keeping a record of who has had Ebola training, and Administrator Dennis Pryor mentioned that “hours and hours have been put into thinking about how to handle this process” and that he “wants residents to feel safe when they come to Salem hospital.”

The meeting began with an in-depth look at the annual audit report with Marmouget of BKD accounting firm. Two of the highlights of the report were solid cooperation in the audit process and no material weaknesses. The hospital has increased their cash on hand to $329,819. He mentioned that this is, in his opinion, “the most important aspect of a hospital.” Also mentioned was the very low level of debt at SMDH. The rural average is 37 percent. SMDH’s is only 7.7 percent debt in long-term debt to capitalization.

Other highlights of the report:

• While the operating loss went up from $392,758 the previous year to $607,858 in 2014, Marmouget said this isn’t of concern because when the $800,000 swing in electronic health record revenue is factored in, it’s a sign of improvement.

• The net operating margin went to -3.3 percent in 2013 to -2.1 percent in 2014, largely from relying so heavily on government payers. This hurts the hospital’s economy, but in reality, the hospital’s economy is largely dependent on it. Because of this, Marmouget stated that “Medicaid expansion would really benefit your hospital.” A PBS special from Jan. 2013 titled “Missouri Medicaid Debate – Salem Hospital” illustrated this looming threat to SMDH and is available to watch on YouTube.

• All critical access hospitals in Missouri are losing money.

• Cash in hand increased by $176,414.

“We believe there’s good oversight at this hospital,” said Marmouget.

Two items he mentioned that are benefiting SMDH substantially are the 340B Drug Pricing Program Integrity Initiative and the Electronic Health Record Meaningful Use Audits. “You’re really benefiting from this program,” said Marmouget. “Drug manufacturers are trying to curtail the benefits of this program.”

Concerning Medicare reimbursement, Marmouget said that there is some risk to the rural programs (Critical Access Status), but that he thinks SMDH will be okay.

Other reports:

• A survey showed that 100 percent of those polled in a recent survey would recommend SMDH Rural Health Clinics for the year to date.

• A motion carried to move the hospital to electronic paystubs through CPSI for a $1000 setup fee.

• All budgeted items were approved including: a dialysis patient lift for $2,037, a copier for $5,557, and an FM scanner for $872.