Bill May, interim CEO of Salem Memorial District Hospital, Feb. 22 presented the hospital’s board of directors with plans and statistics from Rural Hospital Group’s first three weeks of activity at the hospital.
RHG was brought into SMDH by the board of directors for an initial period of 90 days, beginning Feb. 4. Their role is to assist the hospital in responding to the financial crisis that is sweeping the rural hospital industry at large, which has partially been caused by the ongoing global pandemic. The agreement can be renewed up to three more times or canceled with a 30-day notice and is not intended to be the permanent solution, according to SMDH attorney Mark Weaver, in a recent interview with The Salem News.
May has over 30 years CEO experience in rural hospitals. RHG, based in Kansas City, and its partners have worked with over 800 hospitals in 42 states, a large percentage being rural providers, according to its website.
Reports for SMDH financials for December 2021 showed checking, savings and CDs totaled $2.44 million compared to $9.8 million the previous year. For the current year, assets are at $9.5 million, a drop of 44 percent from the previous year’s $17 million. Year to date, SMDH is showing a loss of operations of $2.2 million. A cash flow statement presented showed a cash decrease in December of $1.8 million and $4.35 million for fiscal year 2022.
Numbers presented by May in the most recent meeting state the goals for the next three months total $5 million in increased revenue.
Several factors will contribute to the increase. A hiatus is being issued for three months for the 401k matching program for a savings of about $100,000; short-term disability was being funded by SMDH, but will be moved to a broker within weeks, with a savings of $100,000; 14 dismissals of full-time employees plus 23 additional employees who have submitted their resignation, total $2.1 million in salaries, plus $400,000 in employee benefits.
Days in unbilled charges totaled 13.5 in the early part of February. RHG has lowered the days in unbilled to 8.5 with a goal of six days resulting in $200,000 in additional revenue. Updates to equipment and materials should result in a $500,000 increase in revenue. Additional opportunities for revenue include bringing additional specialists for monthly visits, recruitment for the clinic, additional surgical days and increased swing-bed activity.
A swing-bed is a service that rural hospitals and Critical Access Hospitals (CAHs) with a Medicare provider agreement provide that allows a patient to transition from acute care (a branch of secondary health care where a patient receives active but short-term treatment) to Skilled Nursing Facility (SNF) care without leaving the hospital. This allows a patient to continue receiving services in the hospital even though acute care is no longer required. A hospital that is able to transition from acute to SNF care allows a patient to stay in one place without having to move between hospitals, nursing facilities, or go back and forth between home and follow-up appointments. This is a particularly important service in rural areas because it increases Medicare patient access to this type of care. Additional patients in swing beds, an average of six per day, can create an increase in revenue of $1 million.
Other ideas were discussed including urgent care, weekend clinic hours and other services to assist patients and increase revenue.
