County again decides on no funds for hospital

By Bob Steenson, bsteenson@charlescitypress.com

The Floyd County Medical Center will likely not get funding from the county this year, even after another meeting between hospital administrators and county supervisors Monday morning.

The medical center had requested $100,000 in county funding for the new fiscal year that begins July 1, saying that state and federal payment changes beyond the hospital’s control had sharply cut revenue.

Supervisors had initially decided against any funds for the hospital after receiving a balance sheet from the hospital that showed a $14 million fund balance, with that amount increasing in recent years.

Monday morning at a supervisors planning session, hospital Administrator Rod Nordeng and Chief Financial Officer Ron Timpe again presented information on the hospital’s finances.

Timpe said the fund balance includes the total of all assets, including cash, accounts receivable as well as the value of property and equipment.

Nordeng said, “Property and equipment are numbers on a balance sheet. That’s not something we can liquidate and recover by any means.”

Timpe said total cash in June 2017 was $6.7 million, or the equivalent of about 102 days that the hospital could continue paying its bills if it didn’t receive any more money.

The average cash on hand for critical access hospitals in Iowa is 187 days, Timpe said, so the Floyd County hospital is well under that.

And, he said, total cash in December 2017 was down to $5.6 million, or 78½ days.

Nordeng said the hospital had received about $225,000 less last year than it would have in previous years because of state and federal changes.

Supervisor Mark Kuhn asked about $4.9 million listed as depreciation investments for future purchases.

Nordeng said the hospital is fortunate that it doesn’t have debt and doesn’t have to pay to service debt, and instead saves money for future projects.

For example, he said, the medical center will need a new clinic building eventually to be able to continue to attract physicians as current doctors retire. The hospital needs to be regularly updating its equipment, also, such as the recent additions of a more precise CT scanner and 3D mammography unit.

Kuhn asked if that fund was restricted, or if it could be used for operating revenue if it needed to be.

“We could dip into it and it would look good now,” Nordeng said, “but then it wouldn’t be there for future needs.”

Timpe and Nordeng also said that the Meals on Wheels program resulted in a cost to the hospital of more than $126,000 because Medicare does not reimburse for the proportion of meals that are in the Meals on Wheels program.

“So, (Meals on Wheels), an excellent service to those receiving the service, results in a loss to the hospital of $126,544,” the financial information sheet stated.

Nordeng and Timpe had noted previously that the Floyd County Medical Center is one of the few county hospitals in the state that doesn’t receive annual support from its county. The average county support is well over $1 million a year.

But Kuhn said that since the hospital’s original request, the county has continued to work on its annual budget, and has had to make cuts.

“There are some significant reductions in our own county needs that we will not be funding this year,” Kuhn said. “It’s important that you understand our position and we understand your position.”

Later in the meeting during a discussion on the budget, Supervisor Doug Kamm, who was participating by phone, made the point that “the hospital is not in trouble,” but it was a “wake-up call” warning of funding problems in the Medicaid and other reimbursement systems.

“I think they’d be happy with $50,000; I think they’d be happy with $75,000. It would just be an acknowledgment that we understand their situation,” Kamm said.

Kuhn said it’s still a valid question why saved funds couldn’t be switched to operating funds if needed.

“I would caution about just starting an arbitrary appropriation of $75,000 or $50,000, because it could be expanded, if something didn’t go as planned, into something larger in a future year,” Kuhn said,

“I’m looking at our budget and we did a review of some of the things we are cutting back on departments. I question, at this time, any appropriation to the hospital given the numbers and the review and the discussion we had today,” Kuhn said.

“I don’t disagree with you,” said Supervisor Linda Tjaden to Kuhn. “These are the hard numbers that we have to deal with. I didn’t feel that they’re in this critical stage that this $100,000 is a make-or-break.”

Kuhn recommended that the board keep a close eye on the hospital’s financial situation and keep communicating with its administrators, but that it not provide funding in the next budget. Tjaden and Kamm agreed.

In other budget news, the supervisors ran down a list of department requests that are probably not being funded, as well as organizations that had requested funding and what the tentative decisions were:

• Sheriff’s Office — Asked for one additional jailer and up to $134,000 for new body and vehicle cameras and in-car laptops. Receiving no additional jailer and office will try to fund new cameras and laptops with existing funds over two or three years.
• Various departments — Requested full-time information technology person, at up to about $100,000. Not funded.
• Conservation — Requested moving a part-time person to full-time. Not approved; department will look at intern opportunities.
• Health, Zoning and Emergency Management departments had requested an assistant. Not approved.
• Nora Springs Volunteer Ambulance — requested and receiving $4,685, down from $5,000 in current year.
• Greene Volunteer Ambulance — requested and receiving $2,000.
• Elderbridge Agency on Aging — requested and receiving $12,266.
• Emergency Management Agency — requested and receiving $50,000.
• Foster Grandparents — requested and receiving $3,200, up from $2,500 in current year.
• PAWS and Humane Society of North Iowa — $1,000 for both organizations, up from $500 for HSNI only.
• Floyd County Community Foundation — $10,000 requested and received.
• Floyd County Historical Society — $5,000 requested and received.
• Healthy Harvest — $4,794 requested, $2,500 received.
• Nora Springs Mill Pond Pedestrian Bridge — $25,000 requested and received.
• Rockford Light Project — $10,000 requested, $5,000 received.
• Charles City Community Revitalization — $7,000 requested, $5,000 received.
• Charles City Area Development Corp. — $64,600 requested and received (combination of county and SW Bypass TIF District funds).
• Charles City Chamber of Commerce — $500 requested and received.
• Floyd County Fair Society — $10,000 requested and received.
• Floyd County Library Association — $92,865 requested, $91,955 received.
• Crisis Intervention Services — $4,000 requested, $0 received.

Also at the meeting Monday, the supervisors:

• Met with Chickasaw County supervisors to discuss the salary for the county engineer shared by both counties. Dustin Rolando will receive 3 percent salary increase.
• Heard from Bob Lincoln, CEO of County Social Services, the organization that provides mental health services to a 22-county area including Floyd County, about changes and challenges facing the organization.