[Editor's Note: This is part 2 of a multi-part series of articles about the Grant County Commission work and regular meetings on Oct. 16, and 18, 2018.]

By Mary Alice Murphy

At the regular Grant County Commission meeting on Oct. 18, 2018, the first presentation came from Gila Regional Medical Center.

GRMC Chief Executive Officer Taffy Arias said the hospital is doing a new ad campaign, which is service-based and will feature two billboards. "We're also looking at the look of the hospital. We have been allowed to say we're on a new road. The new campaigns are what we want to look like in the future. We have a new design, not just in the logo, but in our operations."

She said GRMC is heavily recruiting for a new urologist. "We have a new podiatrist in town tomorrow (Oct. 19) and we are setting up his office next week. He is moving from North Dakota with five kids and a professional singer wife. We have a surgeon who is interested in coming to Silver City. We expect an answer later today. As for CRNAs (Certified Registered Nurse Anesthetist), one is looking to retire, so we're recruiting for that position."

"We have a commitment to not only residents in the community but also to you, our commissioners," Arias continued. "We are still committed to our strategic plan. We have decisions to make, including how to recruit and how to expand services so residents don't have to leave Grant County. We are looking at expansion of cardiology and pulmonology services, physical therapy and cardiology and pulmonary rehabilitation, specially for lymphedema. We want to keep people in town. We are expanding our diabetic service lines."

Commissioner Harry Browne asked if the folks the hospital was bringing in were employees of the hospital or independent.

"They will be hospital employees," Arias said. "It is difficult here to recruit independent physicians. The government is putting lot of requirements on independent practitioners. It is tiresome and expensive to keep up with the regulations. For instance, things like malpractice we cover for the employees. Physicians cannot afford the infrastructure for private practice. It's a model being used everywhere, because it alleviates financial risk."

Browne asked if the hospital has had any luck finding an oncologist.

"We have found one, who will finish her fellowship in June," Arias replied. "She is still very interested in the position, because of the support she felt when she interviewed. She has a small child. But we have two others in the interview process, so we are not putting all our eggs in one basket."

Commissioner Alicia Edwards asked if the hospital was satisfied with the number of hours oncologists from the University of New Mexico were providing.

"I won't be satisfied until we have a full-time oncologist here," Arias said, "but at UNM they are committed to providing what we need until then. I have forecast we will need two full-time oncologists. This is a service line we want to continue from early detection through reconstruction. I can't tell you how invigorated I am with this whole strategy of moving forward. I thank you once again for your support. (Chief Financial Officer) Richard (Stokes) and I are always saying how much more we can do, and how much we appreciate your support and that of the community."

Browne addressed Arias' mention of hiring more for diabetic services. "One of the advantages of leaving GRMC independent is that we have the possibility of cooperation with other local entities. HMS (Hidalgo Medical Services) in Bayard, I understand is losing its lease. It has a diabetic educator. Are you being competitive or complementary?"

"We made a commitment to you to turn the hospital around," Arias said. "We also have a commitment to work with other providers. I've never heard anyone come up to me and say: 'How can we help you?' It has to be a two-way street. I think there is a place for all of us. Competition is healthy. It brings in a set of quality matrices. When we are looking at what we need to do as a hospital to provide services, we need to seize every opportunity that comes out way. Everything we've said we're going to do, we're doing. Yes, we're in competition—with Las Cruces, El Paso and Tucson. Just because HMS is offering services, doesn't mean we can't. This is freedom of enterprise. You have entrusted us with this hospital."

Browne said that during the interview before a decision was made to keep the hospital independent, half of the turnaround would be because of the strategic plan. "Are you still pursuing critical access status?"

Arias said: "Yes, but we have to have $5 million in the bank before we can move into critical access. As we work through our financial issues, and they are many; we've fixed a bunch of them and then some more creep up. We have to have about 90 days of cash in the bank because you have to be able to cover all your expenses for that time frame, before we push the button, because the government doesn't reimburse quickly. As we work through this, I can tell you we are about a year behind. We cannot skip steps on this. We can't push the button until we are fully prepared."

Commissioner Gabriel Ramos asked what the hospital has done to reach out to HMS and others.

"There have been conversations," Arias said. "At this time, they shouldn't be made public. As we are working with HMS, there are some hurdles to overcome. I won't give away the farm. My responsibility in working with others is to make sure the relationship is not one-way. We reached out to them to have a 24-hour shift covered. We had to jump through many hoops to get this done in a very short time. We saw it as a door opening to the collaborative process. It is being worked on, but it does take two people in charge coming together to expand for both of us. I told HMS, I shouldn't have to do all the recruiting for one family practice physician. I believe that I should have referrals from HMS and not have to go outside to recruit. I find myself in that position. We made a commitment to you to make this hospital financially sound. It is a growth process that has to evolve. It cannot be forced."

Ramos said he had a family member at Gila Regional for four days. "The service was phenomenal. Thank you for that."

Stokes presented the highlights from the August final report, which had been presented to the GRMC Board of Trustees.

"We had a net profit of $176,316," Stokes said. "Our EBIDA (earnings before interest, depreciation and amortization) was $577,816. That's really close to cash flow. Year-to-date we have a $337,000 loss. EBIDA was $465,000. Last year's loss of at this time was $2.7 million. That is a $2.4 million turnaround, and last year's EBIDA was a negative $2 million."

He said July, August and September seem to be slow months, with the hospital peak months usually from October through March. "We start our fiscal year at a slow time of year."

In August, the hospital completed the 837 rebuild in billing. "That was a major step forward. Previously, we were over-contracting the bills and, in a lot of cases, creating credit balances. It also masked the patient responsibility. We got it fixed."

The cash collection in August was $5.4 million, the highest over the past fourteen months.

"When I first started to take a look at the purchasing group compliance rate, we were somewhere in the 80 percent range," Stokes said. "Now we are at 90.1 percent. We're doing much better making sure we are buying items on contract.

"We had 72 days of cash on hand at the end of August," Stokes continued. "We had 57 days in accounts payable. Our case mix was 1.6, which indicates a fairly sick patient population."

He said September was not trending well, with an additional loss in the month. "We'll report to the board next week. October is trending 11 percent higher than August and September. September was about $2 million less than what we anticipated. In October, we are running 23 percent higher in cash collections. We hit a bump in September. We have had a lot of changes in Meditech, which necessitated a lot of changes in processes in the hospital. It took September to kind of coast with the changes. However, there is one project that is fairly significant to our patients. That is how we charge for drugs at the hospital. There was no logic to the process. There is a functionality in Meditech to figure the charges. Overall, there will be about a 25 percent decrease in charges. For instance, we had a chemotherapy drug that we charged $19,000 per dose. Under the new charging system, it will cost $8,000. Our reimbursement will be $6,000. We're lowering the costs for patient responsibility. We are using logic in a table to do the calculations."

On the issue of critical access, he said, "we've projected we would need to have $5 million on hand. We want to be really sure that it is the right decision. I need some time to continue to improve our revenue cycle, so I know it's what we should do based on what is right for today, not two years ago. We have increased our net revenue by 3 percent, which is about $3 million. When we get everything in place, we may find out that critical access is not the best option if we get our revenue cycle stable and more in line with industry standards. We will have gained the benefits, without having to go through the process of critical access. Once you pull the trigger on critical access, it's very difficult to go back to the PPO world."

Stokes said he planned to file with the state licensing division to designate "our primary care practice as a rural health care clinic. That process will begin. We have multiple other projects that we will hold until the beginning of the next calendar year, while we work to stabilize what we are doing now."

Arias added that the strategies the hospital and board put together "were for a purpose. It's almost time to start to think about next year's strategies. We will keep you informed of them. You may be able to give us some guidance. We will share our successes and our shortcomings. We plan to hold another state of the hospital in February."

Commissioner Brett Kasten asked how the rural health clinic gets reimbursed.

Stokes said it moves it from a physician-based payment to the same as Medicare and Medicaid.

Arias said the hospital strategic plan is a living document.

The next article will begin the review of the agenda from the work session and regular meeting viewpoints.