Veterans Memorial Hospital experiences a March just above break-even; Eye being kept on national health care

by Brianne Eilers

The month of March ended just above the break-even point for Veterans Memorial Hospital (VMH) in Waukon. Outpatient services were down for the month, as were skilled patient days. Deliveries were also down compared to last March. But total surgery volume was up about 10% and emergency room visits were also up a bit.
While the revenue was down slightly, expenses were also down, and all of this translated into a net profit of $920 for the month of March. Year-to-date, VMH is sitting at a net income of $210,495, compared to $240,984 at this time last year, which ends up being a 1.9% profit margin.
VMH Administrator Mike Myers notes that the profit margin percentage becomes significant at this time of the year because how VMH ends the month of April will determine how the hospital approaches issues like raises and contributions to employee insurance. “April has been an exceptionally strong month,” Myers noted, “and we feel pretty good about that.”
Days of revenue in accounts receivable are at 64.3. VMH also has $3,170,000 in cash reserves. The hospital also held open forums with employees to explain proposed pay increases. Myers said they are estimating a 2% profit margin for April, but it remains to be seen if that is, in fact, the case.
Myers also noted that April will be when the Sequestration impact of a mandated 2% reduction in Medicare payments begins. That will have an impact on VMH’s bottom line. “That’s also a reason why I am looking at Medicaid Expansion and pushing for it, because that would help reduce our bad debt and charity care for those folks who qualify for it,” Myers explained.
In other matters, Myers said a proposal is being drafted to be sent to other area facilities regarding lab services. VMH’s lab supervisor, Dr. Ansbough, will be retiring after approximately 30 years of service at VMH, and the letter will inquire as to whether any of the other area medical centers would be interested in providing that service for VMH.
VMH has signed a $60,000 contract in order to begin a remodeling project on inpatient rooms. Myers noted that the project has not begun yet, due to the volume of patients in the hospital. The project will involve new windows that help dampen outside noise, as well as new cabinets, sinks and televisions. Myers estimated that the project should begin sometime in June.
VMH is also looking at how to approach the problem of lack of space in its medical records department. “With all the paperwork required for patients in this day and age, the files get a lot thicker a lot faster,” Myers explained. Space is becoming very limited, so VMH is exploring alternatives to solve that issue, including scanning some documents and putting them on electronic file. Myers noted that the hospital would start that process with older records.
Myers spoke at the Administrator’s Advisory Council April 25. He discussed the Affordable Care Act, which will go into effect in 2014, but he noted that there are already things that VMH has to do to be in compliance with the rules and regulations. The Affordable Care Act is expected to add at least 5% to the health insurance rate for VMH.
Myers traveled to Washington  D.C. at the end of April to get an update on things going on in the Legislature. He pointed out that Senator Max Baucus from Montana, who Myers described as a “champion and architect for the Affordable Care Act,” met with U.S. Secretary of Health Kathleen Sebelius and told her that the Affordable Care Act is becoming a “train wreck” due to the fact that there are so many questionable issues and issues with little to no information, including about the insurance exchanges and how they will work. Myers also noted that it will be “interesting” to see where some of the funding comes from for some of these issues, especially in light of current events such as the Boston bombing and cuts to the airline industry.
Myers also discussed a bit about how in the President’s budget President Obama mentions the distance between hospitals. Myers noted that currently to qualify for the status of Critical Access Hospital (CAH), a facility must be located 15 miles from the nearest competing hospital. His budget is ten miles, and the fear is that the next year it could possibly be 20 or more, and Myers noted that without the CAH designation, VMH would not be able to sustain services.
On a final note, Myers noted that VMH is focusing on how to better deliver medications safely and effectively to patients and has a task force in place to look into the matter.