The Salem Memorial Hospital Board of Directors met for its monthly meeting Tuesday, Oct. 28, during which CEO Brooke Bollman spoke highly of recently held events, such as the LTC Fall Festival and landscaping workday, but also cautioned board members on funding limitations and how affiliation may be the only viable future for SMH.
In attendance included Bollman, board members Dr. Leigh Ann Price, Mike Swyers, Karen Brown, Zach Moser, and Frank Barnitz.
The Rural Health Transformation funds are expected to land at SMDH; however, as indicated by Bollman, the total amount expected is not yet known, and whether these funds will cover the loss that is already expected from the One Big Beautiful Bill Act (OBBBA) is also not yet known.
Already, SMDH is suffering significant hits due to provider rate increases. The Federal Reimbursement Allowance (FRA) is a Medicaid supplemental payment program that helps hospitals get additional funding beyond standard Medicaid reimbursements—hospitals receive regular Medicaid payments and FRA provides additional funds to close the gap between what Medicaid pays and what care actually costs. FRA payments are estimated to be $43,000 less each month—or approximately $500,000 less each year.
“I think that the money that’s going to be coming out is going to have a lot of red tape and strings attached,” predicted Bollman of the incoming Rural Health Transformation Funds. “They’ll be looking to push hospitals to think more innovatively, expand services, expand access to health care—all things that we want to do, but they’ve taken out of operating money.”
Bollman further predicted that the Rural Transformation Funds will be put toward “hubs,” similar to that of the TORCH program. The hubs will direct where and which entities the funds will go, which may include health centers as well as hospitals, which could result in increased competition.
Outside of FRA, cuts to Medicaid are not anticipated until calendar year 2026-27, said Bollman. During those years, uncompensated care is anticipated to increase. Patients with no insurance are expected to increase, attributed to the additional administrative burden in order for them to qualify for Medicaid.
There are options for folk that may qualify for financial assistance through the hospital, which SMDH receives credit for on its cost report—unlike debt. Applicants for financial assistance have to meet certain poverty guidelines to qualify. Other options include payment plans.
What would be most helpful, noted Bollman, staff, and board members, is improvements to the current Emergency Medical Record (EMR) system which is manual. A newer, more intuitive EMR system would flag errors and provide additional administrative assistance that would result in more payments for claims. Unfortunately, suppliers for EMR systems are few, which means the costs for them are high—too much for a Critical Access Hospital to afford without the aid of grants.
“If we order a vitamin D on a 25 year old who doesn't need it, it would pop up and tell you,” described Bollman of a newer EMR system. “Otherwise, we write off that $500 or $600 claim, and all of those things add up.”
CAH’s receive 101% of their reimbursement with 2% removed for sequestration. CAH’s, therefore, receive 99% of their revenue. An additional 4% may be added for sequestration, which means that CAH’s will be collecting on 96% of the cost. Where is the remaining 4% coming from?
“I mean, they make it to where we have to fight for every dollar, and we're just limited,” Bollman described of what CAH’s can do to recuperate losses.
One of the possible options for the Salem Memorial Hospital to pursue to recuperate the loss is affiliation, suggested Bollman.
Bollman shared that hospitals are moving toward affiliations due to many factors, like the post-pandemic financial strain, Medicaid cuts with the current federal administration, and rising labor and supply costs along with the addition of tariffs. When adding all of the pressures, along with the need for technology and improved infrastructure of rural hospitals, operating without affiliation may no longer be sustainable, assessed Bollman. Bollman further noted that she expects to see record-breaking mergers and acquisitions over the next few years.
“It only makes sense to try to optimize by coming together and sharing resources and trying to strengthen those systems,” said Bollman. “It's really about making sure that we have a hospital in a community that would otherwise be 30 miles from an emergency room.”
Bollman additionally noted that the federal administration has also changed things for international recruits, a cost-saving option for the hospital to increase lab techs that is no longer feasible due to those changes. The shortages of lab techs and providers is a nationwide problem, noted Bollman, which international recruits would have helped immensely.
“We went out and worked with an international recruiter,” said Bollman on the process. “There’s actually four candidates who want to come here, but there’s two we signed on with, and we can’t get them here. So, what are we going to have to do? We’re going to have to spend $60 grand a month for two employees to be here. For contract rates. You spend $60 grand a month for contract lab techs. You can’t do that for very long—reimbursement doesn’t match that, and we don’t have an option because we can’t get a waiver because the federal administration says no J-1 visas or H-1B without ‘significant’ or ‘extraordinary’ reason.”
CEO report
Meanwhile, Bollman reported that over the month of October:
• She attended the Missouri Health Association (MHA) District 3 meeting in Columbia, where discussions surrounded Rural Health Transformation funds
• Several roundtable discussions have been conducted regarding the Rural Health Transformation funds, including with MO Health Net, the entity putting together the application for funding for Missouri
• The hospital transitioned to a new hospitalist group and staffing model, in which staff merged the ER in hospitalist providers. Bollman commented that the new staffing model is working well
• Long Term Care (LTC) survey has been completed with minor deficiencies reported, all of which were clerical
• FY25 on-site audit prep work with new audit firm Wipfli, with plans to conduct the audit and cost report at once to streamline the process. Anticipation is that both reports will be presented on time this year
• Hospital staff held a team facilities and landscaping workday to spruce up the exterior of the hospital
• Hospital staff attended several celebrations, including the Dent County Courthouse anniversary and the MRPC annual banquet
• Staff planned an LTC fall festival with a successful event and great turnout reported
Summary of operations
• Inpatient admissions were reported at 52 compared to 45 in August but still lower than the FY25 average of 57
• Swingbed was three compared to one in August
• Inpatient census days were 122 compared to 125 in August
• Outpatient registrations was 1,180 compared to 1,092 in August
• Emergency room visits were 629 compared to 660 in August, with ambulance runs consistent at 218 compared to 269
Income statement
Operating revenue:
• Swingbed revenue was up at $37,800 compared to $19,600 in August
• Outpatient revenue was up at $2.8 million compared to $2.6 million
• LTC patient revenue was down at $97,525 compared to $101,249, due to a vacancy
• Gross patient revenue was up at $5.1 million compared to just $5 million
• Other operating revenue came in at $297,523 compared to $293,925
• YTD, the 340 B program is up $38,000—with FY25 coming in at $120,000 and FY26 coming in at $158,000
• Total operating revenue for September came in at $3.8 million
Operating expenses:
• The largest adjustment, noted Bollman, was in the line for salaries and fringes at $1.8 million in September compared to $1.2 million in August. This was due to contract payouts and a couple of employees who left, requiring a payout of vacation
• In professional fees, September saw $426,000 compared to $245,000, largely due to coding contracts
• Under small equipment, the line increased in September to $23,166 compared to $9,689 in August for telemetry
• General administrative miscellaneous was reported at $90,000 for September compared to $6,000 in August, all grant expenses. Bollman noted that grant revenue will be moved from the income statement and moving it to deferred revenue
• Income for operations in September was reported at $833,136 compared to negative $612,415 in August
• The total revenue for September was just over $1 million
The board approved the income statement.
Chief nursing officer report
Chief Nursing Officer Amber Hogan reported that:
• She attended the MHA Workforce Innovation workshop where staff received innovative ideas on recruitment, including encouraging children to become interested in STEM. Hogan shared that discussions have been underway for implementing an after school club with speakers and field trips planned
• She participated in a risk assessment with other staff members
• Staff members are working on developing a care spectrum which may be presented at the next med staff meeting in November
• An emergency preparedness debrief was held, as there was an instance in September in which power was lost; the internet was also lost, which controls the phones, radios, and other technology. Department directors discussed the problems that occurred throughout the event with frontline staff. A plan has been put in place to help rectify what went wrong
• The EMT training program is going well with 10 EMT students attending. Hogan commended the EMS department for how it was conducting the program
• LTC survey was conducted with surveyors complimenting staff
• Hogan completed the LPN IV push certification program
• A “Skillapalooza” is planned for Dec. 9-10 to train clinical staff on competencies and protocols
• A mock ER is planned for Iron County School District and Viburnum, Missouri fifth graders Nov. 7
Human resources report
Bollman reported that there were three new hires in November and the hospital is now fully staffed with nurses in the ER and Med-Surge departments. Nurses that have departed have returned to the hospital. The hospital is anticipating moving away from contract staffing, the first time in several years.
There was one staff departure in dietary in September, and there are still several job openings.
Quality improvement/risk management
There has been a TORCH program transition, with previous program manager Tabitha Stanfast moving on to another facility. The new program manager, Sarah Arnett, began her position just recently and already has connections with local partners and patients, shared Kendra Mobray.
On the process for practicing excellence, an agreement has been signed and strategic planning is anticipated within the next few weeks. An application has been created for emerging leaders amongst staff with 10 applications filed by interested members.
Mobray further reported success at recent events conducted by hospital staff, including the LTC Fall Festival and landscaping workday.
Mock drills and codes have been going well.
A day was spent with HSG, the liability company, which completed a risk assessment for the ED and a tour of the facility. A report with risk score is to be presented.
Several leadership staff will be visiting Jefferson City and HSG for a root cause analysis survey readiness workshop.
In dietary, a new menu is anticipated to be rolled out, with feedback from patients and residents received. More feedback is hoped to be gathered from staff.
New business
Under new business, Bollman invited two staff members to present quotes on needed supplies—including Jack Linthicum, Cardio-Pulmonary Director, and Logan Pogue, Emergency Services Director. Board members approved both bids presented on the equipment.
The quote presented by Linthicum was from ScottCare for cardiopulmonary rehabilitation exercise equipment, telemetry, and ITPs at a cost of approximately $54,000. It is anticipated that there will be a return on the investment within two months. There are no annual fees on the equipment, and there is a warranty for two years with a chance for an extended warranty, if desired. Equipment would be delivered within a month or so. Equipment would include two treadmills, two steppers, and two areometers.
Bollman spoke highly of the new program to be implemented along with the equipment, as the hospital cares for many patients with diagnoses like CHF and COPD, which the program would help. It would include a treatment plan for 10-12 weeks and sessions 2-3 times a week. Patients would work directly with respiratory therapy staff and have assessments for personalized treatment plans, with the opportunity to graduate based on progress. There is currently a waiting list at Phelps Health for its program, which utilizes similar equipment, indicating a potential competitive edge for SMDH.
Meanwhile, Emergency Services Director Logan Pogue presented a quote from Getinge for approximately $6,300 for a blanket warmer for the ER, which the hospital is currently without. The previous model broke down recently with no success in finding replacement parts, as the model was so old.
In addition, Pogue encouraged the board to consider making improvements to the current vehicle fleet. There have been more and more issues with the fleet, with an estimation of $10,000 spent in ambulance repairs over the course of two months. The board was encouraged to consider receiving bids on new ambulances, with preference indicated for van styled ambulances. Anticipation is that the bids will be received by the end of the calendar year.
The last purchase request for the night was for a physician recruiting firm, Jackson Physician Search, presented by Bollman. If a physician is placed within four months, there’s an initial fee of $3,500; there’s an advertising and outreach fee of $12,000; and a total placement fee of $20,000. The total approximate cost is $38,500, informed Bollman; however. the need for physicians at the hospital is high.
However, Bollman also shared a new recruiter in the military is coming in March, through the SkillBridge Program. There would be no cost to the hospital for the incoming recruiter. Bollman shared that engaging with Jackson Physician Search sooner is due to the high need of the hospital. With that being said, the board approved pursuing Jackson Physician Search.
