As of late September, the 36-bed facility was about $32,500 ahead of budget projections for the year, according to Canyonlands Health Care Special Service District Board chairwoman Joey Allred.
“It’s actually doing pretty well,” Allred said Nov. 26.
Canyonlands Care Center accountant Tom Lacy now expects the facility could end the year with $60,000 to $80,000 more than district officials anticipated when they prepared the 2013 budget.
The district’s 2013 budget, and the tentative budget for the 2014 fiscal year offer a window into its ongoing recovery.
Earlier projections showed that the center’s enterprise fund would operate at a loss of $571,380 for 2013. But Lacy said he now believes the actual operating loss should be around $500,000. That figure does not include depreciation or bond-related costs.
The tentative 2014 budget also includes the $571,380 figure. However, Lacy anticipates that the actual outcome will look substantially different as a result of rate changes and other factors.
“If our occupancy stays at or near what it’s been, we should be substantially better [next year],” he said.
According to Allred, two main factors account for the recent improvement in the care center’s financial position: Medicaid funding per resident day is up from $153 to $172, and perhaps even more importantly, more than $1 million in mineral lease money has come in since last December.
“That’s really what saved us,” she said.
Just this week, district treasurer Ken Ballantyne deposited another mineral lease check for well over $100,000, and more money for the last two months of the year is on its way.
The care center is also collecting more money from its private-pay residents, Lacy said. The facility recently increased its private-pay rate from $171 to $200 per day. Center administrators are also working to obtain Medicare licensure, which will allow it to provide higher-level care, he said.
The facility still faces a number of challenges moving forward.
To begin with, the center can’t rely on the increased Medicaid funding rate over the long term. The $181 figure is only in place for one year, until the start of next August.
Likewise, Allred noted that mineral lease funding is an unpredictable source of revenue.
“While we think it will be going up, we can’t be sure of that and we don’t know how long it will last,” she said.
As it is, the care center’s revenues still aren’t high enough to offset its even higher operating expenses.
By Lacy’s estimates, the facility spends an average of about $212.65 per resident each day on food and laundry services, medical care and supplies, utilities and other costs, not including principal, interest or depreciation-related expenses.
Although the center has been able to cut some costs, Allred said its Moab Regional Hospital bills alone run an average of $30,000 to $40,000 per month.
Staffing and employee benefits are another significant expense, but Allred doesn’t see any way around them.
“If we went to the minimum [federal staffing] requirements – and we’re pretty close – it would make for possibly diminished-quality care, which we don’t want,” she said.
Lacy noted that the care center is continuing to seek legislative changes that could enable it to drop out of the state’s employee retirement system, which could save the facility about $150,000 per year.
As it works to address that issue and other financial matters, the special service district’s board has eyed the possibility of finding an outside entity to manage the facility. At one time last summer, the board even considered a company’s offer to buy the care center.
That offer faded away, and after he delved into the management idea, CHCSSD Board vice chairman Doug Fix came to believe that the district was not on the right track.
Fix said he now thinks the board should explore the possibility of leasing the care center out to another entity; other trustees seemed to agree with him.
The board on Nov. 21 unanimously approved a motion that sets up a three-member committee to work on a formal lease proposal. It also authorizes district officials to contact four entities to find out if any of them are interested in the lease option. As an alternative, it seeks legal direction on how the district might be able to proceed with a long-term management proposal.
If it chose that path, Fix said, the district would need a considerable amount of legal help.
“We’re talking about an enormous amount of work,” he said.
Revised state laws that deal with management proposals are just too complex, he said, and they may have created a less favorable alternative to a lease option.
According to Fix’s interpretation of the recent changes, the district would be required to spell out the terms of a management-type contract in advance.
“We [would] have to make some decisions as to things we thought would be left open,” he said.
On the other hand, a lease option would give the district much more flexibility and control, he said.
In recent months, representatives from three different entities voiced an interest in managing the care center. Two of those representatives said outright that they are not interested in leasing the facility.
Still, Canyonlands Care Center Administrator Roy Barraclough suggested that the district could ask them if they would consider a lease under specific circumstances.
Others said the district should consider the possibility of reaching out to a fourth entity: Moab Regional Hospital.
“No one is in a better position to give us a better deal than the hospital,” Fix said.
CHCSSD Board trustee Tom Edwards said he believes the board should approach the hospital before turning to anyone else.
But Allred noted that the district is legally obligated to widen the field of potentially interested parties.
“We have to put it out to everyone,” she said. “It has to be competitive.”
Hospital secures more DSH seed money
Moab Regional Hospital officials can rest easy now.
On Nov. 21, the hospital secured the final chunk of matching “seed money” it needed in order to receive more than $1 million in federal reimbursements for care the hospital provides to individuals who cannot afford to pay for medical services. The Canyonlands Health Care Special Service District board voted unanimously to commit $140,000 to the facility.
The commitment, along with an additional $230,000 from other donors, will allow the hospital to unlock up to $1.12 million in state-administered funding from Medicaid’s Disproportionate Share Hospital (DSH) program.
The program compensates hospitals for the costs they incur to care for low-income and uninsured patients.
In the last three years alone, Moab Regional Hospital has provided $10.2 million in uncompensated care to the community. About 80 percent of that care has benefited county taxpayers, according to MRH board chairman Mike Bynum.