My View
Why finding DSH seed money matters...
by Mike Bynum
Nov 14, 2013 | 590 views | 0 0 comments | 22 22 recommendations | email to a friend | print
On behalf of the board of directors of Moab Regional Hospital, I would like to thank community members and the local newspapers for highlighting areas that need clarification in regard to the hospital’s request to the county for assistance with Disproportionate Share Hospital Program (DSH) funding. As an all-volunteer board of a not-for-profit organization, Moab Regional Hospital is committed to transparency. We have no agenda other than ensuring our local hospital has a strong financial foundation and the necessary resources to provide the best healthcare possible to this community.

Over the last three years, Moab Regional Hospital provided 32,647 patient visits (yes, that number is accurate) for which we received no or only partial compensation. A total of $10.2 million in uncompensated care was provided, 80 percent of which was given to members of our community. This is a substantial burden, so the United States government provides funding to qualified hospitals through the DSH program. Like most government programs, there is a match required – in this case it is a 30/70 split.

If a local government entity or individual donors supply 30 percent in matching funds (also called seed money), then the federal government will match it with 70 percent. Although the hospital has participated in the DSH program for over 30 years, in 2011 the state began requiring that the source of the match money be from a source totally separate from the hospital. This is why it is suddenly necessary for Moab Regional Hospital to ask for help in funding the DSH match.

As a facility that provides a substantial amount of uncompensated care, DSH payments have been and continue to be a critical part of our budget. Without DSH payments, over the last three years MRH’s operating income would have been a negative $3.9 million, an unsustainable situation that would likely require finding a different operating structure.

For over 70 years Grand County operated the hospital in Moab because it was understood to be a critical service and the county wanted to ensure access to healthcare for the community. In the early 1990s, the tax levy that supported Allen Memorial Hospital was not renewed by the voters, and Grand County struggled to make ends meet, prompting the transition to a not-for-profit hospital. Were the hospital to return to a county-run facility, the expense to Grand County and the taxpayers in providing uncompensated care would be substantially more than the amount that Moab Regional Hospital needs as match for the DSH program. As an example, San Juan County taxpayers contributed over $1 million to San Juan County Hospital last year. The amount needed for DSH match can vary from year to year, but it has averaged around $500,000, which, if raised, returns over $1.5 million to our local hospital to help with the expense of providing uncompensated care.

This is not about subsidizing the hospital and it is not about rescuing the hospital from mismanagement. While the hospital did face financial challenges in 2012, thanks to the hard work of the staff we are in a much stronger financial place. We have brought in industry experts to analyze opportunities for improvement and put measurable plans in place to track our improvement. Yet, even if we run the most efficient hospital possible, providing millions of dollars each year in uncompensated care with no assistance is just not sustainable over the long term. With help from the Grand County Council and private donors, we have raised $230,000 in match money for the 2013 DSH payment, which will provide nearly $700,000 to the hospital to help with uncompensated care. We still need to raise approximately $140,000 to fully participate in the DSH program for 2013.

Some people have questioned if the new hospital was necessary and have suggested that the burden of uncompensated care would not be an issue if we did not have the expense of the new facility to pay for. In reality, if you look at the budget of the old facility, you would find it would not have been viable without DSH funding either. The new hospital has created opportunities for revenue that offset the expense of the debt, and as importantly, the building allows our providers to deliver healthcare without fighting a 60-year old building that was incompatible with advances in modern healthcare and that was not compliant with life safety and fire codes. The ease of attracting and retaining quality physicians to the new facility has enhanced our local healthcare system and ensures that you and your family members have the same quality of care available as someone in Grand Junction or Salt Lake City.

Looking back at the history of healthcare in Grand County, the citizens and elected officials in this community have prioritized and supported healthcare for over a century. Your community hospital invites you to continue that tradition of support, through finding both short and long-term solutions for raising the annual DSH seed money.

Thank you.

Mike Bynum is the chairman and president of Moab Valley Healthcare, Inc.

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