Hospital Update

POMEROY–This week we wanted to discuss the operational and financial situation of the Hospital District. Currently the District only offers those services which are required for us to maintain our license as a Critical Access Hospital (CAH) as well as the clinic. We are required to have an emergency room with lab, x-ray services open 24-hours, seven days a week, as well as acute care.

As a CAH, we get cost based-reimbursement from Medicare. This is our largest source of income so at this point we cannot afford to stop being a hospital. The only service that could be cut is the Pomeroy Medical Clinic. This also would not make financial sense because the clinic is the primary driver for lab, x-ray, and physical therapy volumes which are all positive revenue generators.

The services we are offering are staffed at minimal levels. We don’t have any excess staff on payroll and believe we are as lean as possible. A few examples that demonstrate our Business Office Manager frequently works as a receptionist at both the clinic and hospital to cover for vacations or illnesses. This is despite having more than a full workload of her own.

One of our Co-CEOs and Director of Nursing must work the floor as a nurse frequently, even covering several night shifts. Everyone in our facility wears multiple hats and is called on to help out in many different ways to keep our operation going. This does not mean that we aren’t always looking for ways to reduce our expenses and improve our operational efficiency.

Because we are a CAH, we are reimbursed by Medicare based on our costs, which gives us a higher reimbursement than we would otherwise get. It also means that cutting expenses in certain areas will cause a direct cut to our reimbursement. It is unlike a normal business structure where you can reduce your expenses to match your revenue, because as we cut expenses our revenue will also decrease. We have to be very careful and strategic about what changes we make.

Like many other CAHs our size, we operate at a loss. We are currently working on some strategies to improve revenue. The 340B Pharmacy, which we hope to have up and running by mid-year, is estimated to bring in roughly $160,000 yearly. We are also evaluating a program called Allevant that is designed to boost our rehabilitation program. We are always researching and applying for grants.

Additionally, we are working on increasing clinic volumes through provider recruitment and marketing. And finally, we are looking at different ways to structure the District’s operations that would allow us to provide comparable services in a more financially viable format.

There is no easy solution here as everyone in rural healthcare is looking for new and creative ways to maintain services in their communities. We will continue to work hard to serve our community. We appreciate your support for the Garfield County Hospital!