Veterans Memorial Hospital Board of Trustees discusses "positive" audit results

by Brianne Eilers

The Veterans Memorial Hospital (VMH) Board of Trustees heard results from the recent audit conducted at the hospital by EideBailly at its monthly meeting. According to VMH Administrator Mike Myers, the auditor noted that VMH was “one of the more successful critical access hospitals, given the fact that we don’t get tax money.”
Looking at Cash Reserves on hand, Myers pointed out that VMH is still below the state average, but Meyers noted that the absence of tax money is a factor in that. Within the Liquidity Ratio, which is current assets versus liabilities, VMH is slightly above the Iowa Critical  Access Hospital numbers.
When the audit was conducted, VMH was at 58 days in Accounts Receivable, which Myers said “compares favorably with the state average.”  In the fiscal year 2012, VMH added $834,000 in fixed assets, including a chemistry analyzer, a microbiology system, a truck, and an ambulance radio system, among other items, and $270,000 of that total came from the elevator project as well.
The average age of plant at VMH is going up compared to state averages, but VMH has not done any major building projects since the 1990s. Looking at Capital Structure Ratio-Debt Service Coverage, which looks at VMH’s ability to meet debt service payments of principal and interest from annual cash flow, Myers noted they would like that trend to be up. Currently, VMH is at 3.31%, which is higher than FY2011, when it was at 2.33%. The most current statewide average available was from 2010, when the statewide average was 3.19.
When looking at the Long Term Debt to Capital (Capitalization Ratio), VMH does not have as much debt as many other Iowa hospitals. In 2012, VMH was at 16.3%. Again, the most recent statewide figure is from 2010, at 23.8%. Profitability Ratio-Operating Margin was at 5.2%, and has been steadily increasing each year for VMH.
Examining Profitability Ratio – Deductible Ratio, VMH is found to be pretty much in line with other Iowa hospitals at 31%. In the Cost Indicator Ratio – Salaries to Total Expenses, VMH is at 42%, which is 2% higher than the 2010 statewide average. Overall, Myers said he felt that everything in the report was pretty much positive, crediting the support of VMH’s providers in providing services at VMH and keeping patients that come back to VMH for care.
Looking specifically at the month of September, VMH ended the month with a net income of $50,475. Year-to-date, VMH is pretty much breaking even, compared to a net income of $86,328 last year at this time. Acute patient days and skilled patient days were both down, but deliveries were up. Total surgeries were also slightly up.
Other areas with increases were outpatient physical therapy, outpatient MRI and emergency room (ER) visits. Expenses continue to be under budget, and deductions from revenue were less than what was anticipated. VMH has about $2.76 million in cash reserves and days of revenue in Accounts Receivable is at 66.8.
In other matters, Myers explained an issue that hospitals are dealing with statewide involving anesthesiologists. According to Myers, anesthesiologists have approached Governor Terry Branstad regarding a provision called opt out. “What it means is we use nurse anesthetists, not an anesthesiologist, and almost every rural hospital in Iowa, and probably in the country, uses nurse anesthetists. What these anesthesiologists said is that they want the Governor to rescind what they call opt out. What opt out is, is that we opted out requiring physicians to supervise these anesthetists because they are independent practitioners, they are advanced nurse practitioners and they’ve had nurse training and anesthesia.”
Myers further stated that the anesthesiologists are saying that any time they are working a doctor has to supervise them. Myers noted that if opt out is rescinded, then the physician who is in the ER or in surgery would assume liability when a patient is required to be anesthetized. Many physicians have expressed that they don’t feel comfortable in doing so.
Myers also noted that this would limit nurse anesthetists and that he felt there are not enough anesthesiologists to fill the needs that would be generated by this. “If you don’t have physicians who will supervise anesthetists, there’s no more surgery in small hospitals. There’s no more OB. ER care is compromised,” Myers noted. He further noted that VMH staff, including physicians, the board of trustees and Meyers himself, will all be sending letters to the Governor about this issue.
Myers also recently met with Ben Lange, who is running for the 1st District seat in the U.S. House of Representatives in this current election, and spoke with him about health care issues. There were also some physicians on hand to discuss matters with Lange. Myers said he felt it was “a good visit.”
The nurses’ station project is finished up. “It looks phenomenal,” Myers said. There is now a nutrition room, so patients don’t have to feel like they are intruding when they go to get refreshments. The new design will also cut down on the noise level. VMH is waiting for figures to begin planning the remodeling of some patient rooms. The annual Christmas  Fantasy is also coming up.