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Indian River expecting new $5m gift for Cancer Center

STORY BY MEG LAUGHLIN (Week of February 6, 2014)

After the first quarter of fiscal year 2014, Indian River Medical Center leaders reported last week on finances, emergency room care and progress on reorganization promises made to the Hospital District – and the picture was mixed.

Headlining the good news was the announcement that the foundation is expecting a gift of $5 million soon to support an endowed chair at the new Cancer Center.

The donation helps hospital board chairman Tom Segura keep the promise that the Cancer Center will be funded through donations instead of hospital operational money.

Headlining the bad news is that wait-times in the Emergency Room – despite a mass firing and hiring of ER doctors in late November – continue to remain at an average of six to eight hours.

The average number of patients who leave the Emergency Room without being seen is  still running over 160 a month.

In fact, because of a lack of available staff and beds in the ER and on the floor, on Jan. 25, ambulances arriving at the hospital had to be turned away for seven hours.

CEO Jeff Susi announced last week 13 more nurses would soon be hired and 10 more beds in the hospital and six more in the emergency room would be made available to patients.

The 335-bed hospital has been functioning with over 120 of its beds shut down, according to documents.

Other good news at last week’s Hospital Board meeting came with the announcement that – with the help of a head hunter – hospital leaders expect to have a short list of candidates in the next few weeks to fill the position of hospital chief operating officer, which has been vacant for seven months.

That too, was a promise made by hospital leadership to Hospital District trustees in November, in exchange for a green light to proceed with building the new Cancer Center.

Furthermore, in keeping with a third promise made at the same time by the board chairman, hospital leaders are about to hire a big time global consulting firm – Alvarez & Marsal, which specializes in turnaround management and performance improvement – to conduct a full evaluation of hospital operations.

But one promise made in November by the board chairman has been put on the back burner: the plan to tie the hospital CEO’s salary to performance.

That promise had come in response to an autumn resolution unanimously passed by the Medical Executive Committee, which represents over 200 doctors in the county.

The resolution said a portion of the CEO’s compensation should be tied to outcomes to increase accountability, patient satisfaction, and quality of care.

At last week’s board meeting, Segura said nothing would be done about tying the CEO’s pay to performance before 2015.

After the meeting, board member Paul Nezi, who has repeatedly stressed “the need for accountability and appropriate consequences if goals are not met,” said he was disappointed by the delay.

“I’m still hoping we can move ahead in 2014 with implementing the plan,” said Nezi.

Finally, on the issue of hospital finances, the news was mixed.

While CFO Greg Gardner said at last week’s board meeting “the budget is where it should be,” a hospital budget document shows that the hospital currently has a budget shortfall double what last year’s shortfall was at this time, when the hospital ended up with more than a $3 million loss for the year.

Last year at this time, the hospital was showing an $853,000 budget shortfall.

This year the shortfall is $1.7 million.

But Gardner said he expected the next few months to be “quite favorable” and predicted a break-even budget by October.

“I don’t see anything disconcerting,” he told the hospital board.

Current numbers, however, show declines that are likely to affect finances negatively unless the numbers improve.

Emergency Room visits are off 5.3 percent and surgeries are off 10.7 percent. 

But Gardner reassured the board that hospital leadership would control finances and prevent an operational shortfall for the year “by controlling expenses on the cost side.”

At last week’s hospital meetings, Gardner called the reaction to the hospital’s unexpected need for an extra $535,000 in tax dollars for indigent reimbursement from the Hospital District “a hullabaloo and a lot about nothing.”

And Susi sent an email to the board, staff and donors after the meeting blaming the $535,000 shortfall projection – which came as a shock to the Hospital District – on  former CFO Dan Janicak.

But Susi did not say in the email that when Janicak was CFO, the indigent bills to the Hospital District were under budget for several months before he left because of a concerted effort led by Janicak to qualify indigent patients for Medicaid reimbursement, which took some of the reimbursement burden off the Hospital District.

After Janicak left, the bills to the Hospital District – which reimburses at a higher rate than Medicaid – started increasing, records show.