WINNSBORO – Going over its year-end financial reports on Halloween night, the Fairfield Memorial Hospital Finance and Audit Committee found the information rather scary. By the end of the meeting, CFO Timothy Mitchell conceded that, with little reserves going into next year, the Board will need another infusion of cash from County Council by January.
Mitchell moved quickly, however, to put a pretty face on the financial reports for the fiscal year ending Sept. 30, 2017.
“First and foremost, the loss for the month of September ($106,987) is substantially reduced from the previous month’s loss ($282,619). This is driven by improvement in our gross revenue and an increase in the average daily revenue from $35,670 in August to $45,227 in September,” Mitchell said.
However, committee chairman Randy Bright said the hospital has dropped in total gross revenue year after year by $840,000.
Mitchell also noted that it has been an “abysmal” month in terms of collections, and that he was seeing an alarming trend.
“We’re seeing more and more denials for the ED (emergency department) claims because the insurance companies are deeming them not emergencies and denying them as non-covered services,” Mitchell said. “We do have the ability to bill it as a non-covered charge, but the collection experience with self-pay is typically low.”
“We are between a rock and a hard place,” Mitchell said, “because EMTALA (the federal Emergency Medical Treatment and Labor Act) requires that we not turn people away who present for services.”
Bright noted that net patient receivables have also dropped.
“As you get declining revenues, you get declining receivables,” he said, noting that this has a domino effect on reserves and cash balances.
Another issue, Mitchell said, is that even with losses in patient revenues, the hospital continues to see increases in accounts payable (what it needs to pay businesses and vendors) which climbed almost $100,000 in one month. “That is alarming,” Mitchell said.
Cash balances were also looking slim, Mitchell said. By the end of September, he said the hospital had only four days of unrestricted cash and only 21-22 days of total cash on hand, including cash that the Board had previously decided to restrict.
“What this means is that we have very little reserves, as we go into the next year,” Mitchell said. “Of course, in January, we will make another DSH payment and will need another appropriation from the county. That will bring the cash balances back up, along with normal patient collections.”
“That’s if we don’t make any changes to our fiscal plan or the services we are offering,” Smith said. “That would be extra cash coming in if we won’t be paying out for expenses.”
“If we were to eliminate any services, obviously,” Mitchell said, “since the hospital would not have to pay the salaries or benefits associated with those services.
“That makes it essential for us to streamline before the end of the year,” Smith said.
“And that means making tough decisions about certain departments,” Board member William Turner added.
“Now is the time for us to start to wrestle with those questions.” Mitchell said.
“We’ve never stopped wrestling with those questions,” hospital CEO Suzanne Doscher replied.
Mitchell also reported that the 2015 hospital financial statement audit is essentially complete, and that he expects to schedule a meeting to review it soon. He also said he is setting dates for the 2016 audit and his goal is to have the 2017 audit done by the end of the first quarter.
Boy… how many times have we heard that…
Can they set up a clinic, separate from the E.R., like a hospital I went to in Denver, CO? Then they could bill insurance, and only take the “real” emergencies to the “real” E.R., which is where they took me that day. Triage could separate out the skinned knees and head colds from the concussions and strokes, etc.
Shut it down. Sorry, but reality is reality. Cannot continue to support a failing system!