The Salem Memorial Hospital Board of Directors met May 27 for its regular meeting, in which board members heard the FY 2024 audit presentation as given by Jean Nyberg of Forvis-Mazars.
In attendance included CEO Brooke Bollman, board members Dr. Leigh Ann Price, Mike Swyers, Karen Brown, Zach Moser, and Frank Barnitz.
In old business, an election of officers took place with Price being reappointed Chair; Moser voted Vice-Chair; and Barnitz being voted Secretary.
FY 2024 Interim Audit Report
The financial statements are still in draft form, as inventory count is ongoing due to no inventory count being completed during the last fiscal year. A compliance audit is also underway and nearing completion, as well. Because of a state grant received in 2024 totaling a little over a million dollars, a federal funds audit was also necessary to be completed. The federal funds audit will be provided at a later date.
A final draft of the FY 2024 audit, with minor variations including inventory count, will be presented at a later date.
Nyberg presented a brief overview for the board on the financial statements, beginning with the balance sheet.
Overall total assets reported at the end of 2024 were $13.8 million, with a decrease from 2023 of $15 million. An ending cash balance was reported of approximately $700,000, versus 2023 of approximately $1,572,000.
The main driver of the decrease was ongoing operating losses, resulting in a lower cash balance, said Nyberg.
Patient accounts receivable increased from $2.6 million to $2.8 million. The allowances from the uncollectible piece of the accounts receivable increased to $4.2 million versus $3.7 million, with Nyberg explaining it was related to balances due from self-pay patients, which is being seen industry wide and nothing unusual. Estimated amounts due from third-party payers was reported at $1,860,000, versus the previous $1,401,000.
For fiscal year 2024, SDMH had a receivable for Medicare on its cost report of about $345,000, along with a Medicaid rural health clinic settlement of about $425,000. The state and federal government owed SDMH approximately $800,000 at the end of fiscal year 2024.
In discussions with the state, Nyberg shared that SDMH should be receiving two rural health clinic settlements before the end of the state fiscal year.
Non-current cash and investments did decrease FY 2024—but, from looking at short-term investments, the total between the two categories are the same year over year.
Capital assets did decrease this past year, at approximately $5.7 million dollars. For 2024, capital purchases were put on hold due to cash-flow issues.
Lease and subscription assets faced a similar decrease in terms of payments.
Current maturities and long-term debt do include the 2020 bonds payable. The entire balance of that bond is included in the current liabilities at year end. Accounts payable also increased year over year, at approximately $2,351,000 versus $2,197,000.
Very little long-term debt was reported, as most is classified in current liabilities related to the 2020 bond. Lease and subscription liabilities had no new activity.
Overall net position did decrease—this is essentially the overall loss on the income statement with the income statement total showing a decrease or loss for the year being $965,000 versus $2.3 million in the prior year.
Net patient service revenue did decrease by about $600,000—with it being reported at $25,000,542 versus $26,000,236. This was partially offset by other operating revenue, which was primarily an increase in 340 B revenue year over year.
Total operating revenue was down just slightly at $26,923,000 versus $27,331,000. Total operating expenses also decreased, with Nyberg reporting that almost every category of operating expenses did decrease. One of the biggest decreases was in the administrative and fiscal services, relating to management contracts that had been terminated, reported Nyberg. Overall, the operating loss did improve year over year by “quite a bit”, said Nyberg. Operating loss was reported at negative $2.6 million versus negative $3.4 million.
“Still a pretty big operating loss, but you made a lot of progress in 2024,” shared Nyberg.
Non-operating revenues and expenses had a few changes. There was an increase in the property taxes—increasing $120,000, year over year. Capital grants and gifts included a million dollar grant received from the state.
The decrease of cash, year over year, was reported at $847,000 for 2024; this is an improvement from the decrease in cash of 2024 of $2.7 million.
Nyberg also pointed out a footnote that anticipates, once the audit is issued, it will be the auditor’s opinion to go concern consideration again this year.
“Overall, it’s better than the last couple of years,” commended Price, “I anticipate, with the recent changes as of our beginning of our last fiscal year, July 2024, with the new administration coming on board, that this will continue to improve over the course of our next audit for 2025.”
Nyberg shared that many rural hospitals are struggling. Expectations of turning a large profit are not high. Price further shared that it may get more difficult over the coming year as more changes start coming down from above, with Nyberg also voicing concerns over the incoming tariffs and current pressure on health insurance.
As the balances on the inventory and supplies may change with the final draft, the board approved the FY 24 audit as an interim, with expectations that the final draft will be presented at a later date.
CEO Report
During the month of May, Bollman attended the MHA Rural Hospital Network Meeting where she was given the opportunity to collaborate with several CEOs. Another meeting is coming up in June, where discussions will revolve around the TORCH program, along with changes in RVU compensation for radiology rates. Bollman also attended an AHA meeting, where resources were made available and several staff members set up follow-up meetings for their departments.
She also attended the Annual Becker’s Healthcare Conference in Chicago, sponsored by the Office of Rural Health and Primary Care in Missouri, with discussions surrounding trends, payer challenges, and technology changes, including AI.
Work is ongoing with recruiting and retention, specifically with providers. One provider is returning to the clinic at mid-level. Conversations are ongoing with a couple other providers.
Staff have been also working on advertising scholarship opportunities offered by SMDH. Several staff are currently under scholarship, working on receiving certifications for LPN and EMT.
Contracts have been rolled out, billers and coders onboarded through Warbird.
Bollman has been working on a marketing plan for the year 2026 and hopes to roll out in the new fiscal year.
An initial kickoff meeting for strategic planning at the board level is planned, with a meeting also set up for the rest of staff. Several levels of staff have offered to assist.
In August, there is hopes to see the results of the Community Health Needs Assessment.
The rehab department was recognized by the board for being nominated and recognized as MHA champions of care at the state level—for going above and beyond providing patient care.
The Golf Tournament will be Friday, June 6, with 18 teams signed up.
Summary of Operations
• Inpatient admissions were fairly consistent, with 41 in April compared to 42 in March. There were 52 inpatient days compared to 48 in March. Swingbeds were fairly consistent as well, with 47 compared to 43. Observation was 47 in April compared to 43 in March.
• Outpatient days remained consistent with 1,107 in April compared to 1,114 in March. Longterm care residents went down with 16 reported in April compared to 17 in March.
• Emergency room visits were down in the month of April at 610 compared to 653 in March. Ambulance runs were also down at 216, compared to 249 in March.
Income statement
The following income statement, as reported by Bollman, was approved by the board:
• Gross patient revenue was down at approximately $5.2 million in April, with allowances and collectibles at $3.2 million bringing that patient revenue to just a little over $2 million.
• Other operating revenue was significantly down for the month of April at $74,467.80 compared to $217,799.08 in March. It generally includes rental income, cafeteria income, and 340 B revenue. Walmart’s 340 B revenue was missing for the month of April, with Bollman sharing that sometimes there is a delay.
• Total operating revenue was reported at approximately $2.1 million.
• Total salaries and fringes was reported as approximately one million.
• Professional fees increased, reported at $416,725.59 for April and $297,014.13 for March, with Bollman sharing that it was due to an additional pay period in April.
• Total operating expenses was reported at approximately $2.1 million and, FY 2025 YTD, $19.6 million. Total profit was reported at approximately $7,100.
Meanwhile, with the 340B Pharmacy Program, a loss of $14,536 was reported for the month of April, with Bollman noting that the revenue was down partially due to Walmart revenue being missing.
Cash-on-hand at the end of April was reported as 31 days.
Chief Nursing Report
The following openings were reported:
• Full-time position for RN float
• LTC nursing position
• Emergency services team leader position
The position of case manager was added with Allyson John taking up the role. She has a background in social work and is currently an LPN. The position was added from a CSIP grant through the swingbed program. She will be focusing on swingbed recruitment and marketing.
Amber Hogan will be attending the Rural Hospital CNO certification provided through NRHA.
Hogan also met with new TCTC nursing students and spoke with them about Salem Hospital. SMDH has also participated in the career fair at the high school. The EMS department participated in the Serendipity events at the Upper Elementary.
The EMS department got recertified as a training entity and hopes to begin an EMT-B program in August.
Human Resources Report
No employees departed during the month of April.
There have been five full time employees hired, including the following:
• Quality & Risk Management Director
• Medical Assistant
• Case Manager
• Radiology Technician
• Accounts Payable Clerk
• PRN Employee
• Paramedic
Quality/Risk Report
Last month, results of the employee satisfaction survey results were sent—now, the next phase of the “Culture of Caring” project begins, with a focus on improving employee experience and customer service. Five work groups were formed and have met focusing on different areas to improve, with meetings reported as effective and engaging.
One-on-ones have taken place with leadership staff.
Good response rates were reported for new patient surveys.
The total number of event reports for risk management received were 21, with the majority of those events being medication events; it was clarified that those events were the results of documentation errors and were all corrected in a timely manner. A meeting is planned with nursing staff to discuss ways to prevent those documentation errors from occurring in the future.
Chief of Staff report
Reappointments and new privileges were unanimously approved by the board.
Reappointments:
• Yvonne Prince, MD
• Mohammad Jarbou, MD
• Shiraz Daud, MD
• Dixie Fox, DPM
• Sharon Anderson, DPM
• Justin Hornbeck, MD
• Micheal Stadnyk, MD
• Mathew Stadnyk, MD
• William Mehard, MD
New privileges:
• Malcolm Schulz, MD – Emergency Medicine
• Tanner Risco, DO—Emergency Medicine
New Business
It was requested for SDMH to approve the painting of a memorial for Monty Kitchen on the side of the building, which would include a passage from the book of Psalms and be painted by the high school art teacher, described Bollman. The board unanimously approved the memorial.
Meanwhile, the board also unanimously approved allowing the use of the utility shed to AirEvac.
