GRMC Board of Trustees at monthly meeting 102618, part 2, hears financial report and other updates

[Editor's Note: This is the final part of a two-part series of articles on the Gila Regional Medical Center Board of Trustees monthly meeting on Oct. 26, 2018.]

By Mary Alice Murphy

After an executive session, part 1, lasting about an hour or so, the Gila Regional Medical Center Board of Trustees members came back into session to hear the reports and updates.

The first report came from Jennifer Yost, Auxiliary president. "The number of meals we provide at the Cancer Center is up, so there are more patients being seen. Our membership is about the same, and we always can use more volunteers. We will participate in the Halloween Trunk or Treat. We hope to have a jewelry sale in November and a bake sale in December. We have an online fundraiser with Rada cutlery. The auxiliary gets 30 percent to 40 percent back from your purchase of knives and utensils. The gift shop is ready for Christmas."

No one was present to give a Foundation report.

Chief Executive Officer Taffy Arias presented her report. She said the meeting with Hidalgo Medical Services had a result of the hospital extending the lease for the building in Bayard to HMS for four months until the end of January 2019.

"It will take about a month to have the facility ready for a family practice that we will open there," Arias said. "We made an offer to a urologist, and he accepted. He is working on his license in New Mexico and will begin in January. The oncologist who will finish her fellowship in June is close to making a decision. She told me she could see herself and her child living here. She will let me know in a couple of months. But we are not putting all our eggs in one basket. We have another oncologist candidate coming in November. We have an interview set up with another surgeon, who does oncologic, including breast, vascular and general surgery."

She said the hospital held an extremely successful active shooter drill, which started at the electric company. "Our EMS and three law enforcement departments, took part, as well as our staff. Homeland Security gave us an excellent review for our preparation and execution of the drill."

Board Chairman Mike Morones said the drill showed substantive improvements from prior drills. "We want to keep improving and moving forward."

"I think we had better staff participation, and they viewed it more seriously," Arias said.

Chief Nursing Officer Peggy White said the hospital now has an inhouse person to determine Medicaid eligibility. He has already worked with eight patients.

The hospital also has a Care Links program and has met with the Detention Center administrator Mike Carillo to have hospital staff assist with medical problems, so that inmates are not automatically sent to the emergency room.

Trustee Ed Wilmot noted the ER medical director is gone and asked how it impacted strategy.

"It doesn't impact the strategy," White said. "We continue to work on patient flow, and we are making some process changes and changing some equipment. We did hire a trauma nurse coordinator, so the trauma designation doesn't fall through. She will go to Santa Fe for extensive orientation and training. It's whole two-year process in phases. We are now in data collection, process improvement, policy changes. We're still moving forward on that."

Miller asked if there weren't things that nurses could do without getting physician approval.

"We wrote up the protocol for having pre-approval from physicians for nurses to get started with a patient, so they don't just wait for a physician to be able to assess the patient," White confirmed. "It has impacted our left-without-being-seen population. In the past three months, we've had only one that left without being seen."

The Chief Quality Officer Tanya Carroccio reported New Mexico and other states have initiated an emergency department information exchange. "We're one of the last to be on board, because of the way things happened. We had to have the Meditech upgrade in place. We are reinitiating it with the medical technology to get the emergency department information exchange into our hospital. It helps us determine those with high utilizations. We are at the initial stage in New Mexico. We are giving physicians a direct link to drug utilization. The next phase is care plans. We'll be looking at them next, so when we get to the full implementation, the high utilization patients will have a care plan in place, done by their primary physician or a previous emergency room visit. We want to see the physicians seeing the same information. It will be paid for by the New Mexico Department of Health, so other than some resources, it will be little out of our pocket. We will next be working with on the IT portion. We expect it to be a robust program by the end of the quarter or next quarter. We will be going through all the training on how to access the information on a website."

A mock survey, life-safety-based, on the previous assessment brought good results, but "we found other things to improve on. We want to hold people accountable."

She said when she looks at anything that could be an adverse report, "we monitor it closely to make sure we identify it early on. We are finding that a lot of the problems are in documentation. We have to make sure documents are correct and whether items are reportable."

Chief Financial Officer Richard Stokes asked if the Meditech quality surveillance module would help.

"Greatly," Carroccio said, "especially for on-time documentation."

Stokes then gave his report. "For the month of September, the third month of the fiscal year, month-to-date, the system lost $539,978, as compared to $1.2 million last year at this time. We have a $877,699 loss for this year compared to a $4.03 million loss last year. We aren't satisfied. These losses are driven by decreases in volume. For EBIDA (earnings before interest, depreciation and amortization), the number was $138,478, meaning we spent that much more than we took in, with $326,801 above zero for the year-to-date, compared to a $2.9 million loss last year."

He reported unbilled stood at $2.3 million compared to $6.7 million in February.

"We know we have an issue in Meditech, which means that about half of what Meditech is calling unbilled is not really unbilled," Stokes said. He explained that if a bill is only partially paid or partially denied, the entire bill shows in the system as unbilled. Cash collection is at 29 percent, with the cash to net revenue at 93 percent.

He said the new clearinghouse solution, Quadax, which is the denial management and reporting system, is scheduled to go live on Nov. 7. The pharmacy drug charge methodology is scheduled to move into the live environment on Nov. 5.

"Once the latter is done, we will have overall decrease in drug prices based on our costs," Stokes said. "The system before was not logical. This will be logical and will be consistent. It will fluctuate with changes in drug costs. We've been testing it for the past two weeks."

He said the goals of Gila Regional and HRG, the financial consultants, are "if we have collected 93 percent of the bills from the prior month, we and HRG will do some changes. Our target is to hit our goals within six months. They are aggressive goals, but achievable."

Wilmot asked if the hospital expects for HRG "to be here a while or is our goal to move them out?"

Stokes said the goal was to move them out but he would discuss it with Wilmot outside the meeting.

He said the hospital has been monitoring Cardinal Health, the pharmacy provider at the hospital. "We will have some upcoming changes within 14 days."

To a question about unbilled, Stokes said the unbilled accounts can stay in the system for a couple of weeks, while, for instance, waiting for a pathology report. "HIM (health information management) looks at unbilled accounts daily."

He said they had recently gone into staff and medical records accounts that had late charges and had cleared them out. "Ninety percent of the time, there will be no more reimbursement. I told staff to quit doing them. I would rather they focus on stuff that will make a difference, getting money to flow through the organization."

He said the hospital has about $500,000 a day in uncoded. "It used to be triple that. The ladies in medical records have owned this process. They are motivated to get the accounts prepared to be sent out."

Trustee Dr. Tsering Sherpa asked, from the physician standpoint, if Stokes had seen an improvement in charts.

"Where physicians can really help us is getting the proper codes and queries," Stokes said. "September was bad for the query rate. October has seen significant improvements."

The transfer DRG (drug-related group) process, he said is one he had used at other hospitals. "We are in the process of contracting with Besler, which specializes in revenue recovery. When we discharge a patient, the code says that patient will be going to home health or long-term care. We don't know if they do. If they go to another downstream service, we get paid a little less. If the patient went, it's OK, but if they didn't, we can recover the difference in reimbursement that was rightfully withheld. We calculated we can collect a minimum of $80,000 by doing this little project. There is a 25 percent fee for recovery, but most of the time, we can expect more over a four-year span of time."

Sherpa said it was her impression that 100 percent of patients go where they are told to go.

Chief of Staff Dr. Gregory Koury noted that the patient may not stay at the nursing home.

Stokes said if a bill comes in from the nursing home, for instance, then the evidence is that the patient went. "But if we don't get a bill, then the expectation is that the patient didn't go."

"As we think of things, we try to move on them," Stokes said.

He continued his report and said the cash collections for September were $4.254,297, which was down about $800,000 from the preceding month. "It shows how our revenue fluctuates."

Gross patient revenue from September was $14,304,413, 9.2 percent below budget. In-patient gross revenues were 14.4 percent below budget and out-patient gross revenues were 8 percent below budget.

As of October 18, 2018, gross revenue of $9.4 million had been received with an expectation of $14.5 million by the end of the month.

He said the expectation for the following few months was to be above 100 percent cash to net revenue.

"HRG and our staff are getting old stuff out of the way," Stokes said. "Our goal is to hit our targets by next March. I would like to reiterate a couple of points. Until we get the denial system in place, and when we get it in place, it will narrow down where the denials are happening. On an unrelated issue, we are in the process of renegotiating all contracts."

He said there are three contracts, especially, that the hospital needs to review.

"The Centennial product, and then our problem children are United Health Care and Presbyterian contracts," Stokes said. "We have built a reputation of accepting denials. It will take a year or so for them to realize that we are not going to accept denials. The roadblock is that they will have to talk to the doctor. I also intend to have more conversations with the New Mexico Hospital Alliance on the issue."

Wilmot noted that when he was on a hospital board 15 years ago, United refused to pay bills.

"The insurance commissioner is supposed to track the problems," Stokes said.

Trustee Tony Trujillo said it seemed to him that a good hospital association lobbyist could do something.

Stokes said as the renegotiation process was happening, the physician practices would also be wrapped up in it.

Trustee Joel Schram said the willingness to pay depends on the number of subscribers. "If there are only a few, the insurance company tries to take advantage of them. If there are lots, the subscribers have more leverage."

Stokes said part of the contract says the hospital will accept what United will pay, for instance, and with Presbyterian for Medicaid. "Those are where we have the most problems. Western Sky is the third insurance. Maybe we don’t need contracts with all three. One thing I have to look at is what out-of-network services we provide. The state requires managed-care programs need to have so much presence. If they need me, we're the only hospital in the area, so they need to work with me."

Trujillo encouraged Stokes to tell his stories to the NMHA. "Maybe we need to create a rural hospital association." Stokes replied that there is one.

Koury said his report was in the packet. Miller noted there was a lot of new information.

"We're playing catch up," Koury said.

Miller asked who pays insurance for the medical residents.

"The insurance is paid through the medical schools or the residency provider," Koury replied.

Wilmot said he always looks at a document and thinks about what value he is adding with his signature.

"We need to have the approval," Koury said.

The residency program rules and regulations, which was the first item addressed for approval under the Chief of Staff report, "is contributing to their education," Koury said.

Trustee Dr. Victor Nwachuku noted: "We also learn from the residents, and many stay here or return here."

Miller asked if there are contracts with the medical schools. "Yes, but this is just rules and regulations. The contracts are outside of the purview of the Board of Trustees. And it's not really a contract, but an affiliation."

Wilmot complained that there wasn't enough time for him to read it to approve it. "I don't like the idea of signing it without having time to read it, but on the other hand, I can see the need."

Morones asked if any other committee had reviewed the document.

Koury said: "It went through our committee and the Medical Executive Committee, both of which recommended approval."

Morones asked if there were any time constraints. Koury replied: "Just that it's long overdue."

Trujillo noted that if any amendments were needed, it could go through the process again and be brought back.

Morones said the board has committed to promoting the residency program. "The prior document was poorly done. This improvement with the entities with the most experience approving it makes it reasonable for us to approve."

Koury noted it was a collaborative effort between the medical staff and Hidalgo Medical Services, which houses the residents.

The residency rules and regulations were approved, with Wilmot abstaining because he was not prepared to vote. He made the same statement after the Emergency Department rules and regulations were approved.

Next addressed were the Hearing Process flow chart 8 of 2018 and the Fair Hearing Plan final bylaws.

Nwachuku said it was so complex that it was hard to follow. Koury said the language was fairly standard. Schram noted that it has to withstand attorney challenges.

Koury said the document was also needed in place. Several trustees said it was complex and hard to understand and should have medical staff review. Koury said the previous document had been tested and didn't go well.

Arias said the document had gone through and been approved by the MEC (medical executive committee). "Then we need to educate the physicians on this issue, if some are not understanding it."

A red flag report was handed out for the executive session to follow the board committee reports.

Morones returned to the Fair Hearing Plan. "Do you have the MEC minutes where they approved this plan?"

"And I think the hearing process and flow chart should not be under the rules and regulations, but should be a separate policy," he continued.

Koury said the flow chart is part of the fair hearing plan.

"If we approve them, they become policy," Morones said. He moved to add the flow chart to the plan."

Nwachuku said he would vote against it without review by the general medical staff.

"I would make the argument that it is not general medical staff's expertise," Koury said. "The MEC made the decision and recommendation to approve it."

Trujillo said the board makes policy then the staff has to be educated.

"This is an administrative policy," Arias said.

The vote approved it 3-2, with Nwachuku and Wilmot voting against it.

Morones said the Executive Committee met and created and approved the board and committee agendas.

Miller gave the Quality Improvement Committee report and said the group went over projects and indicators. "We are moving toward a 5-star rating. This quality department is looking at what we have been reporting and making sure that we are practicing evidence-based medicine. The information we are receiving is much more complex that what we were being provided previously. We get into discussions on what is and isn't working in the intradepartmental process. Quality, finance and safety have to work together."

Schram presented the Finance Committee report, which included an amendment to the agreement for HMS to use the hospital-owned facility in Bayard at 805 Tom Foy Boulevard. The amendment would extend the agreement from Nov. 1, 2018 through Jan. 31, 2019 to allow HMS more time to vacate the building.

"We are still focusing on cash collection," Schram said. "We want to turn invoices into cash coming into the hospital. We want to see the percentages of claim denials going down."

The next report was by the Plant and Facility Committee. Schram said they met and spent time on efforts developing modified meetings and after-action items. "It will be a learning process. I think in the long run it will be more beneficial to the committee to understand where we are at with our plant and facility and equipment."

Human Resources Committee did not meet in October but would meet in November.

The last item before executive session was the Board Bylaws Committee, which did not meet and did not make changes.

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