Hospital delays budget decision

Commissioners push to keep obstetrics services

— When presented with six options to drastically cut costs in 2014, Three Rivers Hospital commissioners leaned toward the only one that would keep obstetrics.

The Top 3 options discussed all involve layoffs, reducing surgery department hours to regular business hours Monday through Friday, and keeping the emergency room but reducing the trauma level from level 4 to 5 so an on-call surgeon wouldn’t be required.

Option D would turn the hospital into an outpatient clinic while still providing emergency services; Option E would close the hospital altogether; and Option F was to delay a decision by the board. The board chose to delay its decision, but reached a consensus that keeping labor and delivery was a priority.

“I know that as the board sits here, we are going to continue to move forward and get more information,” Commissioner Dan Webster said. “I don’t think we are going to change a lot today.”

“Rules are made and rules are changed, and there are exceptions to rules. I just want to explore them before a decision is made,” Commissioner Jerry Tretwold said.

At a standing-room-only board meeting on Monday, Chief Executive Officer Bud Hufnagel said he doesn’t want to see the hospital shut down, but “On our own merits, there is not a snowball’s chance this hospital is going to survive as it is going forward.

“The feedback we’ve heard now has been overwhelming that the community wants to keep (obstetrics). What we’re talking about is the survival of the hospital, and what form that looks like,” he said.

“We have no desire to eliminate anything, but at the end of the day we’ve got an obligation to pay for it. It gets to be a very short conversation: How are you going to pay for services if you don’t have a base to pay for those services?”

Despite impassioned pleas from physicians and other hospital staff to keep services such as cardiopulmonary rehabilitation, respiratory therapy and obstetrics, Hufnagel was blunt: “This is absolutely a business decision,” he said. “This comes down to money, and that’s as cold and crass as I can make it.”

Option B, which would keep the labor and delivery department, also estimates the biggest annual loss – $309,316 – even with the layoffs and eliminating cardiopulmonary rehabilitation, Healthbeat Fitness Center, Advantage Durable Medical Equipment and total joint replacement surgeries.

That option also results in the least amount of layoffs, going from nearly 104 full-time employees to about 85.

Only one option would result in a profit: Option C, which would cut labor and delivery, cardiac rehab, Healthbeat and Advantage, and lay off about 22 people. That would net a profit of more than $216,000 per year.

Option A would have a staff reduction of about 23 full-time positions and cut all of the above as well as total joint replacement surgery. The hospital would still see a projected loss of $224,225 per year with that plan.

Tretwold said the hospital, 507 Hospital Way, has managed to knock outstanding warrants with Okanogan County down to $2.141 million, when they were at nearly $2.9 million in September.

“It’s gone up and down, but we have steadily dropped that number. We’re pretty happy about that,” he said.

The primary concern raised Monday is the exodus of physicians from the area and the trouble with recruiting. Hufnagel said one new physician through Wenatchee-based Confluence Health will begin practicing in Brewster at the end of January, and one more doctor is mulling her options.

“Where we are, for all intents and purposes, is that we’re down to a couple of full-time practicing physicians in the community today,” Hufnagel said. “We simply do not have enough doctors here to do what we need to do.”

Dr. Joseph Matel, who is leaving the area next month, said he took another job to ensure that will be able to continue practicing obstetrics.

Other doctors, including Keith Hanson and James Wallace, have expressed concern that other physicians will leave the area and it will be even more difficult to recruit new practitioners if the hospital eliminates the labor and delivery program.

Hufnagel said admissions, baby deliveries, patient revenues and patient days are all down, along with reimbursements from Medicare and Medicaid. Length of stay was down 16 percent from 2011-2012, but the hospital has seen an uptick of about 12 percent over the past year.

“Those down numbers reflect what the community feels about support,” employee Roger St. Clair said. “Things need to change for them to be happy, and we need to make our doctors happy. We need to make decisions that take care of us, and somebody’s not making those decisions.”

The hospital is in the process of establishing an affiliation with Confluence Health, which has offered along with other area providers, to do what they can to help displaced Three Rivers employees find new jobs. Confluence may also take over the cardiac rehab program, because after Jan. 1 Three Rivers will be required to have a cardiologist on site all the time to provide direct supervision.

“Our folks do a terrific job, the patients love it, but… that program doesn’t make money and has never made money,” Hufnagel said. “What will probably happen is that whole program will go to Confluence Health and they’ll simply run the program.”

In a letter to the board signed by several physicians and hospital staff, Dr. Gordon Tagge said the proposed changes would cause “irreversible consequences.”

Twenty-seven-year employee Jan May said she didn’t want to see services cut, but the hospital was faced with a similar decision five years ago and chose not to take significant action.

“I would rather see us make a sustainable decision than to be guided by the passions that we all have,” she said.

Hanson suggested making services more viable rather than eliminating them and making deeper cuts to administration, a sentiment with which one community member agreed:

“Stop chopping at the base of the tree, start chopping at the rot at the top,” he said. “Word of mouth will kill this hospital and that’s what you’re doing – killing it.”

Dr. Eric Haeger said he would like to see the hospital address ways to boost revenue instead of cutting services.

“You can only cut your expenses so far before you destroy the infrastructure that brings the revenue,” said Mike Hassing, chief executive officer of Family Health Centers.

Bennie Polvos, who runs Advantage, said he has made an offer to the hospital to buy Healthbeat and Advantage to keep those services in the community.

“I’ve sacrificed more than I can say in the last five to six years to try to make this business what it is and take care of the patients,” he said.

“I think we are all in the mindset that we are going to work our very best to keep O.B. open, to keep respiratory therapy open,” Commissioner Vicki Orford said, noting that it isn’t fair to the staff or taxpayers to put off a decision for much longer.

“We need to make a decision, and we need to do it diligently and quickly,” she said.


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