Meeting set for hospital board, district trustees
Hospital District Trustees will have a joint meeting with the board of the Indian River Medical Center next week to ask questions about finances and get new information on patient care from the hospital leadership.
As elected officials who direct tax money to the hospital and own the hospital land and physical plant on behalf of taxpayers, District trustees say they feel obligated to ask hard questions of the hospital board – questions that the majority of District trustees believe should have already been asked of hospital management by the Medical Center’s own board.
But because the majority of hospital board members seem hesitant to brace hospital management on tough issues – for fear, some say, of being called “anti-hospital” – the Hospital District is scheduling this new face-the-issues summit.
As part of the District’s preparation for the question-and-answer session, District trustees met with hospital auditor Jim Grigg last week to question him about the health of hospital finances.
For 2013, the hospital has an operating loss of about $4 million, a 15-year operating loss of $52 million and less cash on hand than what national financial analysts (including Moody’s) say a hospital should have. But Grigg said that the hospital’s finances are “satisfactory” because the hospital has no debt.
“No debt is a huge plus,” he told District trustees.
District chairman Tom Spackman responded that the hospital would soon incur debt, when it borrows $20 million to purchase Vero Radiology.
“Then, what we have on hand would be unreasonable,” said Spackman.
Along with that purchase, the hospital is incurring millions of dollars more in expenses with new projects like the Wellness Center and the Cancer Center at a time when numerous financial and patient care issues are being raised.
But Grigg said these new projects should increase revenue and help the hospital.
“Why do you say increase revenue? They will decrease revenue,” said District trustee Burton Lee.
The hospital’s own financial projections on the new Cancer Center show that the hospital would make about $3 million more over five years if it keeps its current cancer care program. Further, the purchase of Vero Radiology with its imaging center threatens the money-making capabilities of the imaging center at the planned Wellness Center, which concerns District trustees.
“There will eventually be increased revenue with the new projects. But it will take time to get there,” said District trustee Harris Webber.
In their discussion last week, District trustees listed 12 areas of concern to be discussed at the upcoming joint meeting with the hospital board:
- Patient care and satisfaction
- The hospital’s overall financial performance and reasons for contradictory numbers
- The need for common financial terminology so that “likes are compared to likes”
- The need to include doctors in decision-making
- Emergency department operations and contracts
- The electronic computer system
- Contracts with Duke Medicine
- The impact of purchasing Vero Radiology
- The need for a comprehensive development plan for the hospital
- Competitive activity and its likely effect on hospital volume and profits
- A clearer picture of what the Cancer Center will be, and
- The hospital CEO’s ability to run the hospital on a day-to-day basis
Spackman told District trustees that hospital board chairman Tom Segura had expressed concern that the question-and-answer meeting “not turn into an adversarial session.”
“We all care about the hospital and want to improve things. We don’t want a war between the District and the hospital board,” said Spackman.
Paul Nezi, one of the few hospital board members known for asking hard questions, attended the District meeting and commented: “Probing questions that need to be asked are often viewed as adversarial.”
Hospital board member Hugh McCrystal, also known for addressing issues, attended the District planning meeting, and said he hoped the hospital’s top management would be at the upcoming joint meeting.
“They need to listen,” said McCrystal.