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HomeMy WebLinkAbout2012-0807 ACH Council Jt MIN Joint City Council/ACH Board Annual Meeting August 7,2012 Pare I oft MINUTES FOR THE ANNUAL JOINT MEETING ASHLAND CITY COUNCIL/ASHLAND COMMUNITY HOSPITAL BOARD August 7,2012 Council Chambers 1175 E. Main Street Councilor Voisin called the meeting to order at 6:45 p.m. Mayor Stromberg arrived at 6:50 p.m. Councilor Morris, Lemhouse, Slattery, Silbiger and Chapman were present. CEO Mark Marchetti and Board Director Doug Gentry were introduced and presented the annual report. Mr. Marchetti commented on the challenges that the Ashland Community Hospital (ACH) has dealt with over the past few years. Despite these challenges, the hospital has been able to add services, increase volumes, improve productivity and reduce costs. He went on to explain the need to affiliate with another hospital or healthcare organization as it was in the best interest of the long-term survival and growth of ACH. He stated that Huron Healthcare Consulting worked closely with the Board of Directors and Senior Leadership Team which lead to the following goals: Maintenance of broad range of inpatient and outpatient services; long-term financial support for services at ACH; support for ACH's core value of patient-centered care; commitment to the maintenance of employment at the hospital; support for the local primary care and specialty physicians and maintenance of ACH identity. The work with Huron created a Confidential Information Memorandum (CIM) document, which was distributed to 23 potential partners. After carefully analysis, the Board entered into a ninety- day period of exclusive negotiations and due diligence with Dignity Health. This process continues and it is hoped that it will be completed with the next two months at which time, with Council's support a binding Memorandum of Understanding will be signed formalizing ACH membership with Dignity Health. . Mr. Marchetti presented statistical data related to the fiscal year ending June 30, 2012 for ACH. The hospital generated gross revenue of$94.3 million, which resulted in $48.5 million in net revenue following deductions for contractual adjustments, charity care and bad debt. ACH had a total operating expense of$51.6 million and when combined with some non-operating revenue, resulted in a loss for the year of approximately $2.5 million. The many accomplishments for ACH were noted along with significant capital purchases. Mr. Marchetti stated that the hospital industry is capital intensive and must remain current with equipment, systems, and technology in order to remain competitive in providing patients and physicians with the highest quality healthcare. He noted the increasing federal government reporting requirements on hospitals related to quality and patient satisfaction. The HCAHPS Program (Hospital Consumer Assessment of Healthcare Providers and Systems) is the survey methodology for measure patient perception of the hospital Joint City Council/ACH Board Annual Meeting August 7,2012 Page 2 of 2 experience. Participation in the survey process is required of all hospital participating in the Medicare Program. ACH remains committed to the community it services and continue to operate student services in elementary and middle schools in Ashland and Talent. The hospital and its Foundation have support community organizations and activities through grants, sponsorships and participation in community celebrations and events. Mr. Marchetti responded to questions by council that ACH does not currently offer abortion services, invitro (due to need of proper equipment) and that ACH does not interfere with doctor patient decisions. He stated that the new Memorandum of Understanding does not propose an established council liaison on the Community Board and that the Board of Directors and Dignity Health are working toward holding a public meeting in the near future. Meeti was adjourned at 7:07 p.m. lcww-� �� db7w� Barbara Christensen, City Recorder J n Stromberg, Mayor a Ashland Community Hospital Ashland Community Hospital Annual Report to City Council August 7, 2012 The past few years have been challenging for Ashland Community Hospital. Despite efforts to add services and increase volumes, improve productivity and reduce costs the Hospital's financial performance has suffered. Factors contributing to poor financial performance include an increased percentage of Medicare and Medicaid patients and declining reimbursement through these programs, increasing costs for labor, drugs, and medical supplies, rapidly changing technology, and the overall state of the economy leading to high unemployment, loss of health benefits, and increased out-of-pocket costs for many who do have health benefits. In the summer of 2011 the Board of Directors concluded that an affiliation with another hospital or healthcare organization was in the best interest of the long-term survival and growth of Ashland Community Hospital. Huron Healthcare Consulting was engaged to assist the Hospital with the affiliation process. Working closely with the Board of Directors and the Senior Leadership Team, Huron led a process to identify and define the Hospital's attributes, financial and market strengths and challenges, and strategic alternatives. Goals for an affiliation were identified including: • maintenance of a broad range of inpatient and outpatient services • long-term financial support for services at ACH • support for ACH's core value of patient-centered care • commitment to the maintenance of employment at the hospital • support for local primary care and specialty physicians • maintenance of Ashland Community Hospital's identity Huron's work with the Hospital culminated in the creation of a Confidential Information Memorandum (CIM). This document was distributed to 23 potential partners. Four chose to submit a proposal. After careful analysis at a meeting of the Board of Directors held on April 3, 2012 the Board agreed to enter into a ninety-day period of exclusive negotiations and due diligence with Dignity Health. This due diligence process continues. In early July the Hospital received a detailed term sheet outlining the details of Dignity's affiliation offer. These terms are under discussion with Dignity with the support of Huron and the hospital's legal counsel. It is hoped that this will be completed within the next two months at which time,with Council's support, a binding Memorandum of Understanding will be signed formalizing Ashland Community Hospital's membership within Dignity Health. Issues related to the Hospital's affiliation have consumed much of the time and energy of the Board of Directors and Senior Leadership over the past year. Despite this, however,the Hospital has continued in its mission of meeting the healthcare needs of the citizens of Ashland and surrounding communities. For the fiscal year ending June 30, 2012 Ashland Community Hospital • Admitted 1,514 patients • Provided 5,078 days of inpatient care • Delivered 362 babies 280 Maple Street, Ashland,Oregon 97520 www.ashlandhospltal.crg ^dsc +± Tel: 541.201.4000 • Fa,: 5a 1.489.7411 • Completed 3,168 surgeries and special studies • Treated 8,171 patients through the Emergency Department • Registered 58,281 outpatients • Made 7,603 home health visits • Provided 7,343 days of hospice care The hospital generated gross revenue of $94.3 million. This resulted in $48.5 million in net revenue following deductions for contractual adjustments, charity care and bad debt. These deductions totaled 49.2% of gross revenue, up from 47.3% in the 2010-11 fiscal year. As has been the case over the past eight years, the hospital has continued to see increased write-offs as Medicare, Medicaid and self-pay volumes have increased. For fiscal 2011-12 the hospital had total operating expenses of$51.6 million. This, when combined with some non- operating revenue, resulted in a loss for the year of approximately$2.5 million. Despite the challenges of the past year,the Hospital accomplished much in 2011-12. I • JWApril the Hospital underwent a very successful accreditation survey through DNV Healthcare. • The Hospital's CT service was accredited by the American College of Radiology. The Hospital has now achieved ACR accreditation for both CT and mammography services and will pursue accreditation of ultrasound services in the new fiscal year. • The hospital's Pharmacy was successfully surveyed by the State Board of Pharmacy with no findings reported. The Dietary Department scored 98 out of 100 points on a survey by the County Health Department. The Hospital's Center for Wound Healing was once again recognized for outstanding patient outcomes. The Hospital was recognized as a Bike Friendly Workplace by the League of American Bicyclists. • Renovations were completed to re-locate all imaging services,with the exception of CT,to the upper level of the Diagnostic and Surgery Center. This has eliminated the way-finding issues that have been a constant source of patient complaints since the Diagnostic and Surgery Center was opened in 2006. • With the financial support of the Ashland Community Hospital Foundation, the Emergency Department is being renovated. In addition to creating a more pleasing environment for care, the project was designed to improve patient privacy and increase operating efficiencies. This renovation project is expected to be complete within the next two weeks. • Renovations were completed for a new employee lounge, the Wound Center comfort zone, and an OB/Family waiting area. The Gift Shop was renovated using funds raised by the Hospital's Auxiliary • In September 2011, the Hospital opened the ACH Center for Family Medicine. The Center employs four Family Practitioners, two Pediatricians, and two nurse practitioners providing services five days per week in offices located in Ashland and Talent. Along with the Center for Internal Medicine, opened in 2008, these employed-physician practices not only meet current needs for primary care but create a platform for bringing additional physicians into the community in the future. Offices for the Family Medicine Centers were renovated with the financial support of the Ashland Community Hospital Foundation. • An additional physician was added to the ACH Center for Internal Medicine to meet growing demand in that clinic. • A number of electronic systems were implemented to enhance operating efficiency and better meet regulatory and accreditation standards. These include a new on-line education system for employee education and training, an electronic system for reporting and trending of unusual occurrences and incidents, and a database of all hospital policies, procedures and contracts. • A minor procedure rooms was created within the Hospital's Same Day Surgery area to create a more cost- effective option for non-complex, elective surgery. Price competition from free-standing surgery centers has been a significant issue for all hospitals in recent years. • With the support of physicians with from Medford Radiology Group,services in interventional radiology were initiated. • The Hospital submitted an initial application for Destination Status through the Planetree Organization. Achievement of Designation Status has been a stated goal of the Board of Directors from the start of the Hospital's affiliation with Planetree in 2007. • The Hospital completed training in Lean techniques for senior leadership and a group of approximately 25 middle management and staff employees. The Hospital's first Lean process re-design revolved around the patient registration process. • At the annual employee recognition dinner held in October, 37 employees were recognized for 640 years of combined service to our Hospital. Approximately $1.5 million was allocated for capital investment in fiscal 2011-12. Significant capital purchases include: • Nurse Call System • X-Ray Machine • Cardiac Monitors • Automated Medication Dispensing System • Bronchoscope • Urology Instruments • Vitrectomy Equipment(for retina surgery) • Hematology and Chemistry Analyzers • Ultrasound Machine • Patient Beds • IT System Interfaces For better or for worse, the hospitals industry is capital intensive. A Hospital must remain current with equipment, systems, and technology in order to remain competitive in providing patients and physicians with the highest quality healthcare. Over the past several years, the federal government has imposed increasing reporting requirements on hospitals related to quality and patients satisfaction. In the coming years, Medicare will begin to adjust reimbursement based on these quality and satisfaction measures. The HCAHPS Program, the Hospital Consumer Assessment of Healthcare Providers and Systems, is a survey methodology for measuring patient perception of the hospital experience. Participation in the survey process is required of all hospitals participating in the Medicare Program and results are publically reported. Over the past year, Ashland Community Hospital has consistently scored near or above CMS averages on all dimensions of satisfaction reported through the HCACPS program. Furthermore, based on the most recent public reporting of HCAHPS results, Ashland Community Hospital is ahead of both Providence Medford Medical Center and Rogue Valley Medical Center in 7 of 10 measurement categories. ACH scores are similarly positive compared to average scores for the State of Oregon and the nation as a whole. Core Measures are CMS indicators of quality for specified care processes including acute myocardial infarction,heart failure, and pneumonia among others. Reporting of Core Measure increased from 32 indicators in 2011 to 74 indicators in 2012. Ashland Community Hospital has consistently met 100%of Core Measures in most areas. In those areas where fall-outs have been identified, action plans have been implemented and improvement has been made. As a mission driven organization, Ashland Community Hospital remains committed to the community it serves. Over the past year the Hospital has continued to operate student health services in elementary and middle schools in Ashland and Talent. The Hospital and its Foundation have supported community organizations and activities through grants, sponsorships and participation in community celebrations and events. Perhaps the greatest reflection of the hospital's mission to the community is in the provision of approximately $13 million in uncompensated care including $1.4 million in charity care, $1.9 million in bad debt write-offs, a$9.3 million shortfall through the Medicare Program, and a $400,000 shortfall through the Medicaid Program. These shortfalls represent the difference between what the Hospital receives from the Medicare and Medicaid Program and what it actually costs to care for Medicare and Medicaid patients. We now look forward to the next phase in the evolution of our hospital. While change is difficult, we have evolved numerous times in our 105 year history and will continue to do so as the health care system and medicine evolve. We are confident that the future of our hospital will be bright as a part of Dignity Health; that Dignity will bring to our Hospital the resources,support, and size needed to be successful in the current healthcare environment; and that we will continue to meet our mission of providing for the healthcare needs of our community.