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THC updates area residents on future

Tyler Tribute of Tyler, Minnesota

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Dr. Ocampo signs on to stay at THC

The Tyler Healthcare Center hosted a community meeting on Tuesday, Oct. 27 at the Tyler Golf Course. Interim CEO Dale Gillogly welcomed the crowd before turning it over to John Utoft, who spoke on behalf of the THC Board of Directors. Utoft said the board shares the public's concern over the future of THC.

"We all have the same concerns and that's the health and sustainability of our healthcare system," Utoft told the crowd. "The good part is that we are going to come out of this better than ever. I think all of us here on the board are completely convinced of that."

Utoft wanted to assure everyone that it has been business as usual at the facility.

"Every day we have been providing service up at our hospital," Utoft said. "It has not stopped. It has not taken a dip. There are hundreds of acts of compassionate care that take place."

Utoft said the hospital has been in contact with the current employees to help make them comfortable with the transition. He told those in attendance that most of the dialogue that has been ongoing from the board of directors has been focused on Avera purchasing THC.

"We're basically convinced it's going to happen," Utoft said "I can't see any reason why it won't. We actually have a go-live date of January 1st. Maybe that's a little ambitious. There's still a lot to do. This is a complicated process legally."

With Medicaid, Medicare and insurance companies all paying bills, Utoft said it takes a while to sort out all the details, but on the major points, all parties involved are on the same page.

"All the important things we are in total agreement," Utoft told the crowd. "Avera wants the same things for Tyler and Tyler Healthcare that we want. They want to keep the same services we have. They want to enhance services wherever they can. They want to keep the staff here. As you all know we've lost a couple of doctors. We appreciated their service to the community and we wished them well. We have to move on."

He went on to say that they are in the process of recruiting a new doctor and will soon have a second visit from one of the candidates They are also working on the final stages of deciding on a new CEO.

"We've got a lot of candidates that we interviewed," Utoft revealed. "We have it narrowed down to two or three."

Gillogly said he anticipates he will probably be in Tyler yet for another two months.

He took the opportunity to announce to the crowd that one of the current physicians at THC, Dr. Eric Ocampo, would be staying with the hospital for the foreseeable future.

"We had a conversation this evening and we have agreed to a new contract with him and Dr. Ocampo will be staying with us," Gillogly revealed. "I'm really pleased to be able to share that with you this evening. I'm glad he's here. I'm glad he's staying."

Mary Maertens, Regional President at Avera Marshall was also on hand. Maertens said they are anticipating a lot of good things that will happen. She said that a detailed review of all the current benefits was done and the effects of a transition from the current state to what it would be after fitting into the Avera system.

"Overall there are extensive improvements in the benefit design for the staff," Maertens announced. "Certainly there are a few changes and we will work through those as we go forward. In total, everyone should experience a net increase in their take-home pay because of the lower cost of benefits available to the staff."

She also said that current balances for sick leave and time off would transfer into the Avera system at 100 percent of where they are at the time of the closing.

"We also noted that there will be no reduction in staff as a result of layoffs going forward," Maertens. "Everyone will maintain their current [full-time equivalent] at the time of the transaction."

Maertens also said everyone would maintain their current rate of pay.

"So good news overall that was shared with staff," Maertens said. "We had a lot of positive buzz going on throughout the facility yesterday."

Gillogly told the audience that the CEO search included a list of 35 candidates.

"In some of our larger communities we don't get that large of turnout," Gillogly said. "That's an excellent candidate pool to start with."

From that original list of 35, the list was narrowed first to between 10 and 15 before settling on a final five.

"We had those five come and visit us," Gillogly told the crowd. "Out of that five we're now at process where we're going to have two candidates come in. Either candidate could do a good job. They're very people oriented. It's really going to be up to the staff at the hospital and the physicians as well as the board to decide who is going to be the right fit for you. Those two individuals will be here the afternoon and evening of November the 10th."

Gillogly also said he is optimistic and encouraged by a second visit to THC of a physician who is considering an offer. He explained that a severe shortage of doctors in the country makes the competition stiff, particularly for those who would be interested in relocating to the rural surroundings of southwestern Minnesota. In addition to their own search, Gillogly said they have engaged Avera recruiters, as well as a third-party search firm to help with filling the positions. In the interim, Dr. Richard Klingler has been filling in around 12 days per month, including one weekend.

Kory Holt, Assistant VP of Financial Interaction with Avera told the audience that financials are still being analyzed going back over several years and a new audit system is being implemented to get a better view of what is happening every month. He explained that hospital financials are difficult to estimate with the reality that what is billed out is not always what the hospital gets paid. In addition, there is no guarantee that when they do get paid that it will be within a month, six months or a year. Holt said that in the past there was not the best system set up for helping predict what some of those answers will be.

"One thing we found during the audit process was that there wasn't really a very good structure process for us to really be able to estimate those types of payments in our financials in order, so that on a month-to-month basis we really knew where we were," Holt admitted. "That's important because it is a very significant number. All facilities, including Tyler at this point, are integrating the process of having a system in place that helps us do that each month. That is important for not only the administrators, but for the staff to understand how their departments are run."

Gillogly told the Tribute on Friday that safeguards are being put in place at all Avera facilities to help identify problems earlier in the process.

"This will help us monitor more closely the performance of a local managed hospital," Gillogly revealed. "We're going to say 'if we're managing you, these are the things that are going to have to be reported at each board meeting.'"

He also said he is optimistic about the results of negotiations with Blue Cross Blue Shield of Minnesota that will bring a favorable financial gain for THC beginning in 2017.

"The dollar value [of the savings] is probably going to be about $250,000," Holt told the crowd. "For a facility of this size — where we are — it is very meaningful that that's going to happen."

In answering a question on the stability of the finances from the audience, Gillogly said that earlier in the year there were some disconcerting numbers.

"There was a point — I don't remember if it was May or June — that we were down to seven days cash on hand," Gullogly said. Holt told the audience that the benchmark for facilities the size of THC should be closer to 65 or 70 days. Gillogly said that he would-be more comfortable if that were over 100.

"In terms of where we were at, cash on hand measures our ability to pay our bills. When you're at seven days cash on hand you're in a critical spot. You are prioritizing paying your staff, paying your local vendors," Gillogly reported. "That's where we were at."

Currently, Holt said, the facility is up to around 35 days cash on hand.

When pressed for an answer from the audience on how the finances got to where they are and specifics about profit margin in the previous three years, board member Utoft took the floor and explained that he realized there is an "elephant in the room," but like any other business their hope is to put a positive spin on the situation and not create possible litigious situations by dwelling on the negative.

"I can tell you that in 2013 we lost about a quarter of a million dollars," Utoft replied. He also explained that it got worse in the next couple of years.

"When it happened in '13, I will tell you that the board was very concerned," Utoft continued. "It is complicated how we got to that loss. Basically I'm going to tell you, hospital business is really tough. Yes, I think we missed some opportunities that we weren't aware of."

Utoft said the board discussed and toyed with several options, including paring down, but in the next year the problem got no better. He also admitted that at the time, "quite a bit of information was being withheld from the board." Utoft said for obvious reasons the board does not want to get into specifics, but would only comment on the situation generally.

"I want to put some of your minds at ease," Utoft told the audience. "We don't feel there was anything illegal that happened. I can tell you I know that there've been rumors out there that embezzlement may have taken place. I can tell you that is not true, but I will also tell you that I think there was some mismanagement."

Utoft said he hates to see anyone dwelling on the negative of the past.

"During this whole thing we kept providing very good healthcare," Utoft said. "I'm going to tell you this again. Every day there continues to be hundreds of acts of compassionate care. That's what's most important. Do we want to learn from the past? Absolutely Do we think in hindsight that we could have done things differently? Absolutely The biggest thing I would say, when I look at my role on this board, is that we didn't pick up on the idea that we need help. All the national dialogue about healthcare in small places like Tyler is about pairing with bigger organizations."

Utoft said part of the problem was the board wanted to keep those bigger organizations at arms-length and didn't totally understand the whole situation.

Curt Hohman, Senior Vice President of Network Operations with the Avera-McKennan Rural Hospital Network, has been coming to meetings in Tyler since the late 1990s, and explained that losing money is not exclusive to Tyler in our region for facilities similar to THC.

"If you look at the State of Minnesota, hospitals our size that have a nursing home with them on average do lose money every year," Hohman said. "So we're in very popular company."

Hohman explained that this past year was very difficult in part because the new Electronic Monitoring Record (EMR) system was not working the way the administration wanted it to be working.

"Despite Herculean efforts from our staff to try to make the corrections," Hohman said. "There was oversight processes in place that were lax. I'm the guy who has been coming to the board meetings all along so it's my responsibility. We've put a number of things in place that shares information with Avera. We put things in place so there is more information shared with the board. Moving forward we feel comfortable that we've got almost everything worked out."

Hohman said he is confident that things have been put in place to make the corrections needed to prevent those problems in the future.

Board member Jim Veire said he faulted the local board for not paying closer attention to the trends in healthcare, and that the board should have moved toward paring with Avera five years ago.

"That, in my opinion, was our fault," Veire admitted. "That was our failure."

Hohman explained that Avera is currently in a long process of due diligence in order to make sure that THC is a good fit into the Avera system. Likewise, THC formed a committee to confirm that moving into the Avera fold would be beneficial for the Tyler facility.

Laurie Johansen spoke to this process from the audience, and said they liked what they saw.

"Part of our process was contacting many of the facilities in [the Avera] system who have been in our shoes and have done this," Johansen said. "That only made our confidence stronger. 1 can tell you that all the board members can hardly wait for this to happen because we are going to be so much better off. You can hear that [from other Avera facilities] surrounding this whole region."

After a question from the audience spurred discussion on the future of the nursing home, Maertens told the audience that Avera has a long-time commitment to long-term care and did not see that changing going forward for the Tyler facility.

"I'm personally very passionate about our long-term ministry," Maertens said.

Utoft admitted that the nursing home has been a long-time drain on the THC system.

"As the Tyler board we can't go to Avera and say we absolutely require that you guarantee that you're going to keep our nursing home running," Utoft admitted. "I think it is going to have a heck of a lot better chance of staying open and staying sustainable under the ownership of Avera."

Maertens also mentioned that THC received positive news from the state on the quality of care at Sunrise Manor Nursing Home. The Minnesota Department of Human Services and the Minnesota Department of Health released their nursing home report card, indicating that THC received a Five Star rating in Residents' Quality of Life and State Inspection Results.

Maertens also commented that after the transition, the corporation will still stay intact, necessitating the existence of a board of directors. After ongoing legal dialogue has been finished, possibly in mid-November, a decision will be made as to whether the transition could be completed by March 1, 2016 or if it is something that will wait until March 1, 2016.

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Original Publication Date: November 4, 2015

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