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By Dan Rudy 

Hospital board discusses finances, facility future

 


For the first time in more than two months the board of trustees for Wrangell Medical Center found themselves with a quorum March 25, in a meeting postponed from the 18th.

The hospital’s financial situation remains delicate as staff recover from a difficult combination of low reserves, high receivables, sluggish Medicaid payments and rising operating costs.

In her board report, hospital CEO Marla Sanger reported a $155,000 loss for the month of February, or $141,822 when grants were taken into account. Net charges came to $704,398, short of around $860,000 in expenses for the same period.

“March appears to be a bit better,” she added. Sanger said the hospital for the month had over $521,000 in reserve; at February’s end, this number had been at around $574,000.

She reported Medicare payments were also starting to come in more regularly. However, Sanger also recently learned the results of a desk audit conducted in January determined Wrangell’s hospital owed the federal provider $104,000.

The hospital’s situation is still an improvement from December when Sanger and acting financial officer Olinda White approached the Wrangell City and Borough Assembly to reveal WMC was experiencing financial difficulties. In November the hospital had only $123,000 on hand, and its accounts receivable had ballooned to $4.3 million.

White had come out of retirement in October to serve as the hospital’s acting CFO, following the departure of its previous officer. While White has committed to stay on board until next January, Sanger said the search for a permanent replacement has not begun.

She explained the CFO search was on hold during the hospital’s financial stabilizing.

“Do you have a timeline?” asked Bernie Massin, chairing the board.

Sanger replied that the search would resume in three to four months, perhaps sooner. Sanger added she had possible candidate in mind, the details of which were not elaborated.

Massin said he hoped she would find a CFO “sooner rather than later.”

Speaking as a person to be heard, the Assembly’s liaison to the hospital board, Stephen Prysunka, wanted to encourage the board to pursue an active hunt for a full-time replacement.

While he agreed White has been doing a fine job seeing the hospital through its financial difficulties, Prysunka said it would be preferable if she was also still on hand for an overlapping time to help train and acquaint a replacement with WMC’s particulars.

Another item on the hospital board’s agenda will be maintaining the medical center’s financial independence. While she explained keeping the hospital financially independent remains a priority, Sanger told the board they may have to begin considering other options.

“At some point it may not be feasible,” she said.

One course Sanger suggested was that WMC could become part of a larger health organization, such as PeaceHealth.

“I think there are ramifications to that. I would prefer we not do that,” Prysunka commented. In particular, he worried what effect such an arrangement would have on the local economy as positions were consolidated with a larger network.

The other course would be to seek a cost-sharing arrangement with the Borough. “Our hospital may need more community support, going forward.”

“Someday we may have to get money from them,” Massin said. “I’m hoping we won’t.”

Speaking on the city’s own financial situation, Prysunka pointed out Wrangell is looking at budget cuts itself. “There are a lot of things coming our way that aren’t good,” he said. “The city is not in a great position to bail the hospital out.”

Board member Cori Robinson asked if the hospital has a strategic plan in place. Sanger responded that Foraker Group president and CEO Dennis McMillian is being brought in to help develop one.

“It’s been a long time since that’s been done and it’s about time,” she said. McMillian is being brought in to help move plans for a new hospital facility through the predevelopment stage, which Sanger said would help stabilize WMC’s financial situation.

On that topic, a pair of public meetings being jointly hosted by the hospital and Alaska Island Community Services are scheduled for today at the Nolan Center, from 1-5 p.m. or 6-9 p.m. Titled “The Role of a New Hospital in Our Future Healthcare System,” the goal of the presentation is to seek out community input and to re-engage residents with the idea of building a new hospital.

 

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