Fiscal year's first quarter shows Veterans Memorial Hospital just above break-even

by Brianne Eilers

The end of the first quarter of the Fiscal Year brought some disappointing news for Veterans Memorial Hospital (VMH). Year-to-date, the hospital is showing a net income of $7,486, which is significantly less than last year-to-date’s profit of $54,225. VMH administrator Mike Myers noted that $7,000 is almost a break-even point for them. “Historically, we have made our best bottom lines in the first quarter of our fiscal year,” Myers noted.
Looking at the numbers for September, acute patient days in September were at 155, nearly the same as last September, but down about 70 from last year-to-date. Skilled patient days were down 11.6%, and deliveries were also down, at 11.5%. Surgeries are up at 15.7%, and outpatient physical therapy was up 36.3%. Outpatient revenue, which has been a strong area of growth, was nearly “flat.” Inpatient revenue was just slightly higher than budget for the month of September, but is down 11.3% year-to-date. Deductions from revenue are up slightly, 2.8%, year-to-date. Total operating expenses are down nearly 5%, which Myers said is due in part to a wage freeze at the hospital.
“It is a concern starting the second quarter of our fiscal year at essentially break even,” Myers said. VMH does have $1,372,000 in cash reserves, which Myers commented that VMH is being “very judicious” on how those dollars will be spent, in the event that the hospital has to “survive on those.” Bad debt and charity care are also up, as they are statewide.
The financial picture gets a little more dicey, too, due to the recent budget-cut decision by Governor Chet Culver. There will also be a five percent cut in Medicaid because of a need to make cuts in State budgets, which Myers noted is about a $36,000 a year ($3,000/month) hit to the VMH bottom line.
On the Growth and Development Committee front, the committee is currently focusing more on sustainability. Members are looking at what VMH is doing now, and how they can do it better and generate more volume. The Medicaid budget cut goes into effect in December. Myers did say that October seems to be looking better, but it’s hard to tell at this point what the month will bring. “We’re still in the hunker down mode,” Myers said.
While trying to be conservative in their spending, VMH is also trying to address issues where things need to be fixed or improved, such as the roof, and they are hoping to have a new elevator in 2011.
In other matters, VMH is hoping to be connected to the ICN network by the end of the year. The conversion to digital radiology is almost complete; Myers noted that there is a learning curve with the process. VMH will be getting a new roof, installed by Winona Roofing. The insulation is back-ordered, but Myers noted that they are hoping to have the project done before the snow starts falling.
Myers has written a letter of support to Gundersen Lutheran for telemedicine technology. “Telemedicine is where the specialist does not drive down here, you sit in front of a TV screen and they look at you that way,” Myers noted. Myers further commented that he felt some of the specialty services that are provided would eventually go to telemedicine. “As you look at healthcare reform and how they are trying to cut payments, I think it will become increasingly difficult to get specialists to rural Iowa,” Myers said. Telemedicine will be one of the ways that rural hospitals will have to get around that situation.
There are also several issues that VMH and hospitals statewide will be dealing with, including the lack of adequate mental health providers and facilities in the state, which Myers noted will not be a “quick fix.” Many facilities are at capacity currently, making it difficult to find placement.
VMH also had its Annual Quality week, and the focus is for good communication and patient care.

Also at the Board of Trustees meeting, they heard from various departments and groups in the hospital who updated the Board on what’s going on and how the hospital staff is working to improve services. The balanced scorecard for VMH showed that the hospital is within range of or better than their goals in most categories, the only category currently needing work is the Operating Margin, which Myers noted that there isn’t much the hospital can do about that at this time with the current economic status.
VMH is also monitoring re-admission rates within 30 days for the same diagnosis. With the onset of flu season, and especially with the H1N1 flu virus going around, VMH has had to adjust its policy for visitation of patients. There will be a limit of two visitors per patient at any time. The hospital is also asking that no children under the age of 15 visit, and no visitors will be allowed in the OB unit, except for the husband or significant other of the mother. Visitors who are exhibiting signs or symptoms of influenza will not be permitted.
For more information on the new guidelines, visit the Veterans Memorial Hospital website at www.vmhospital.com. These new restrictions have been put into place in order to better protect the patients of VMH. “We sincerely do not want people who come to the hospital to get sick, and help prevent the spread of that (influenza),” Myers noticed. The new visitation rules will be in place until further notice.
He also stated that there have been some difficulties in getting the H1N1 vaccine, and so the hospital is really focusing on the guidelines set forth by the Center for Disease Control on who are the “high-risk” persons. Myers did also point out that persons wishing to be vaccinated who fall outside the category of high-risk, as set forth by the C.D.C. guidelines, will probably not be able to get vaccinated, even with a physician’s order. “We are committed to following the CDC guidelines,” Myers said. He further pointed out that in some states, the vaccine is so hard to get, that health care workers are not being vaccinated, because they are saving the vaccine for the high-risk patients only.