IRON MOUNTAIN - Dickinson County Healthcare System's revenues soared in June, providing some stability after months of red ink.
Hospital trustees on Thursday approved a financial report showing operating income of $691,042 in June. For the year, DCHS is showing a loss in operating income of $264,994.
When interest expenses are included, net income for June totaled $619,128. Year-to-date, DCHS is showing a loss in net income of nearly $795,000.
John Schon, administrator/chief executive, said he's "cautiously optimistic" that the hospital's finances are turning around. He cautioned, however, that more swings could be ahead.
Gross revenues were just as good in March as in June, Schon noted, but poor reimbursements in March pushed the hospital deeply in the red that month.
"It shows how fickle the health care business is," he said.
The June surge was partly due to cost-cutting measures. But mainly it was because the hospital was better-paid.
"We're still on a roller-coaster ride financially," Schon said.
There are numerous factors in hospital reimbursements from Medicare, Medicaid and private insurers. Some monthly variables are out of the hospital's control.
In other action Monday, the board received a positive report on professional and general liability insurance.
ProAssurance is providing coverage to DCHS at $460,704 for the year, a reduction of about $100,000. In addition, the new plan provides improved coverage for legal defense.
A major contributor to the lower rate is DCHS' malpractice claims experience. DCHS is considered "Best in Class" with a loss ratio over the past six years that is half the national average, Schon said.
"I believe that our low malpractice rate is a quality indicator," he said. "It is a testament to the medical expertise of our physicians and to the level of care provided by our staff system-wide."
In other business, the hospital board:
- Learned that DCHS may soon be ready to apply for a U.S. Department of Agriculture Rural Development low-interest loan for a new medical building on the hospital campus. As proposed, the hospital is under no obligation for construction and would have a two-year window to decide.
- Heard Gary Lindeman, pharmacy manager, report on the successful implementation of the new Paragon Pharmacy Management computer system. Besides decreasing chances for error, the new system communicates with the existing information infrastructure throughout the health care system.
Cost of the pharmacy upgrade was approximately $85,000, which will be recouped indirectly through increased reimbursement on services provided to Medicare and Medicaid patients.
In addition, it is a necessary step toward Computerized Physician Order Entry (CPOE), which is a precursor to qualifying for economic stimulus incentives for electronic medical records. All told, more than $3 million in incentives may be available to DCHS in the years ahead if all conditions are met, Schon said.
- Heard a presentation from Johnsons Controls Inc. on potential energy efficiency improvements. An infrastructure upgrade for Dickinson County Memorial Hospital, Dickinson Medical Building and clinics in Florence, Wis., and Wausaukee, Wis., would carry an estimated cost of up to $845,000 with total savings of $2.5 million over the next 15 years.
Under a proposed agreement, DCHS could finance the project through its guaranteed energy savings. The proposal was referred to the board's building committee to make a recommendation.
Jim Anderson's e-mail address is janderson@ironmountaindailynews.com.