Hospital remains optimistic in light of state funding cutbacks

Talk about it

Community Memorial Hospital CEO/Administrator Rick Breuer remains positive about the hospital’s future operations despite Governor Tim Pawlenty’s recent veto of funding for General Assistance Medical Care (GAMC).

GAMC, which provides health care for some 30,000 of Minnesota’s poorest, most vulnerable, citizens, will be discontinued next March as a result of the governor’s action. That means hospitals around the state face the potential of treating more patients who are unable to pay without hope of reimbursement.

Earlier-released state estimates pointed to a potential revenue loss to CMH of anywhere from $438,000 to $1.1 million as a result of the move, but Breuer said those figures paint something of a skewed picture of the direction he believes things will actually head.

“With GAMC going away,” said Breuer, “I do expect some folks will come in who can’t pay their bills. As a result, they may not go to the clinic for that preliminary visit any more but head straight to the ER instead. Though that may mean an increased revenue loss to the hospital, it doesn’t necessarily reflect an increase in overall numbers.”

In anticipation of the move, Breuer said CMH plans to take a conservative approach to planning and budgeting, but added the hospital “intends to protect programs and people.”

“We have already asked staff and department heads to suggest ways we can save on costs,” Breuer said. “We are starting out by looking for those simple things that don’t affect patient care or staffing. The hospital is already running pretty lean to begin with.”

Breuer said rural health care facilities such as CMH are actually doing “better than most” in light of recent funding cuts, but admitted, “We are certainly not where we’d like to be, however.”

He said the fact that CMH is a critical access health care facility has helped protect it somewhat in light of other funding cutbacks and added that while many larger hospitals have relied on their investments to meet their bottom lines, CMH has always counted on meeting its bottom line through operations instead.

“We don’t have large sums invested,” he said, “and what we do have is done very conservatively.

“Our core business model works here,” said Breuer, “and for right now at least, the hospital is stable and solid.”

He admitted that increasing bad debt and lower patient numbers due to the economic challenges the area is facing are obstacles the hospital will have to work to overcome, but he said he doesn’t anticipate any dramatic changes as a result.

“These [most recent] cuts won’t turn things upside down for us,” he predicted.

Earlier this week, members of the Minnesota House of Representatives Health and Human Services Policy and Oversight Committee announced they will be visiting hospitals across Minnesota in the coming week to discuss alternative ways to meet the needs of Minnesotans currently receiving GAMC after the program disappears next March. The group originally intended to hold one such meeting at CMH, but scheduling conflicts forced cancellation of the local session. Similar meetings will be held at hospitals in Cambridge, Thief River Falls, Detroit Lakes, Brainerd, Bemidji and four metro-area hospitals.

Watch future issues of the Pine Journal for a full report on the results of those meetings.

Tags: news, health, cloquet, legislative