The hospital’s bottom line showed more than $90,000 to the good for July, Three Rivers Health officials said.

Chief Financial Officer Steve Andrews said an increase in demand for a variety of services netted the hospital more reimbursement amounts. Through the first seven months of 2010, Three Rivers Health had a net income of nearly $39,000.

The amount, however, remains short of the hospital’s projected 2010 budget by $265,000 through July.

That’s one of the observations shared during the Three Rivers Health Authority Board meeting Thursday morning (April 29th) as representatives of Plante & Moran, PLLC reviewed the hospital’s audit report for 2009.

According to the report, Three Rivers Health had an operating loss of about $400,000 in 2009 compared to a loss of almost $3 million in 2008. The bottom line for 2009 was a loss of $589,000 compared to a loss of about $3.1 million the previous year. Auditors said, “2008 was a really, really tough year, and there has been significant improvement in 2009 based on the difficult decisions that this board and management have made.”

Plante & Moran issued an “unqualified opinion” regarding the audit, the highest evaluation of the hospital’s accounting processes.

During a post-meeting interview, Bill Russell, president and CEO, expressed pleasure with the report. He noted that there were “no deficiencies” and it was “a good year in the books.” He said the audit reflects “that there is integrity in our accounting processes and we feel really good about that.”

Regarding the bottom line for 2009, Russell said, “Last year was a better year. It wasn’t where we wanted to be, but a much better year than the previous year, and this year is going to be a considerably better year than last year. We anticipate to be operating above the line. We’re going to leave the red environment and move into the healthier environment of black ink so that’s a good thing.”

The meeting also brought some encouraging signs in the March financial reports showing net income for the month of nearly $100,000 ($97,535). Although it was more than $140,000 ($140,188) under budget, there was a “black ink” performance for the period that shrank the year-to-date loss for 2010 to just under $213,000 ($212,894).

In reviewing the March numbers, Steve Andrews, vice-president of finance, said, “March ended up pretty close to where we thought it would be.” He said March was the “highest admission month in quite some time” at 150, identical to a year ago. He noted that lab procedures in March were higher than the prior year and budget, indicated that home health visits were also up, and said other outpatient visits exceeded budget in March.

Regarding FTE’s, Andrews said March was the first month that the impact of recent adjustments were noticeable and indicated the effects will continue to be seen over the next three months.

Andrews said that “most notable” in the report was the fact that outpatient revenue for the month exceeded budget.

As far as April is concerned, Andrews said the “best case scenario” is that there is “probably going to be a slight profit.”

This event has been specifically designed to gather audience input regarding the strengths of the hospital, opportunities for improvement, and future possibilities that will meet the healthcare needs of our local community. Residents can attend either evening.

“Three Rivers Health remains dedicated to providing the compassionate, award-winning care our community expects and deserves,” said William Russell, CEO of Three Rivers Health. “We’ve faced some difficult challenges this past year, and I feel it is important to connect with our community members and receive their input. These town hall meetings provide an opportunity for Three Rivers Health to listen to the Voice of our Community.”

Russell, along with representatives from the Three Rivers Health Authority Board, Medical Staff, and leadership team will be at the meeting to listen to comments and take questions from the audience.

For more information, call (269) 278-1145, ext. 202, or visit www.threerivershealth.org.

The board approved a resolution to extend debt covenants with Chase for another 90 days – until June 1st – with instructions to negotiate the terms. The covenants call for an accelerated principal payment of $30,000 a month for the next three months, plus the original principal payment, and paying off a ‘swap’ of $210,000 by March 31st.

Another 90-day extension on the note expired on February 28th and required payment of a $30,000 extension fee.

The board also authorized the administration to continue to negotiate with another financial institution, CapitalSource, to establish a line of credit and empowered the Executive Committee to approve the line of credit when complete.

The moves reflect ongoing efforts to shift the long-term debt from Chase. Lancaster Pollard, a consulting company that works with health care organizations on financing and refinancing, is assisting with those efforts after being engaged to do so through board action in October. Regarding the work by Lancaster Pollard, CEO Bill Russell said, “Mostly the feedback they’re getting is that the banks are in a ‘wait and see’ position.”

During a post-meeting interview, Russell discussed the debt problem and said, “It will be nice when we get this attended to and this is no longer an issue and we can actually pay more attention to what’s really important – and that’s taking care of the good folks around here.”

Three Rivers Health is working to shore up its financial condition after recording a net loss of more than $3 million in 2008. The red ink was trimmed to just over $757,000 in 2009.

After losing more than $273,000 in January of this year, Russell announced last week a work force reduction affecting 28 departments and involving the elimination of 16 positions and the reduction of 45,000 hours worked. According to Russell, the “reduction in force to equalize hours to volumes” was being implemented “to return Three Rivers Health to financial viability and to continue and sustain the mission of quality healthcare.”

The financial report reviewed during Thursday’s meeting revealed a net loss of just under $37,000 ($36,932) in February, an amount that was nearly $71,000 ($70,654) below budget. Steve Andrews, Vice President of Finance, said there “could be a slight profit in the month of March.” For the first two months of 2010, the bottom line is a net loss of a little over $310,000 ($310,460) which is more than $240,000 ($240,389) below budget.

In a news release issued Monday afternoon (March 15th), Russell said this will affect 28 departments and regrettably, involve the elimination of 16 positions and the reduction of 45,000 hours worked.

The news release says that, over the past two years, Three Rivers Health has struggled to maintain current programs and services while enduring operating losses. A significant contributor to these losses is the number of hours being used to produce the amount of care and services in light of lower demand. This coupled with Michigan’s economy, pressures from lending institutions, and mandated information technology upgrades has had a direct impact on the financial position of Three Rivers Health.

According to Russell, the reduction in force to equalize hours to volumes is being implemented to return Three Rivers Health to financial viability and to continue and sustain the mission of quality healthcare.

Larry Clark, Chair of the Three Rivers Health Authority Board, said, “This move to right size creates the opportunity for Three Rivers Health to regain financial stability without compromising patient care or access and should insure long-term employment stability. We remain committed to providing high quality healthcare to Three Rivers and the surrounding area.”

Three Rivers Health recorded a net loss of more than $273,000 ($273,529) in January, an amount that was nearly $170,000 higher than the loss of just under $104,000 ($103,793) that was budgeted for the month.

The February meeting of the Authority Board included discussion regarding the development of “dashboards,” similar in concept to what drivers utilize in operating their vehicles, to provide information to better match staffing with volumes.

Alice Mayer, hired recently as Vice President of Quality & Risk Management, provided an overview of Lean Six Sigma during a “Board Education” presentation that was part of the February meeting of the Three Rivers Health Authority Board last week (Thursday, February 25th).

Mayer stressed the importance of “the voice of the customer” in the Lean Six Sigma process and said that the top hospitals have one thing in common: “They listened to the voice of their customers.”

Nancy Buscher, Vice President of Patient Care Services, said, “I think it’s phenomenal that we have Alice because we need to think differently.”

During a post-meeting interview, Bill Russell, President and CEO of Three Rivers Health, discussed the initial focus on the Emergency Department. He said, “We’re not happy, but more importantly, our customers are not real happy about the throughput process in our Emergency Department.” He explained that the hospital is “actually trying to teach these tools and we’re also trying to improve a process so those two events have been bundled into our initial program of Lean Six Sigma improvement.”

Russell indicated that two different groups are involved and said, “One is working on the time it takes from our front door until you see a doctor and the other has to do with the turnaround time for laboratory testing.”

Russell said, “We’re taking about 12 to 15 weeks, which is longer than it would normally take to do a Lean or Six Sigma project, but we’re also using it for its academic opportunity as well so that, instead of just fixing one process, we now have a group of people who actually can take the skills that they’re acquiring …and apply it again, and again, and again to a myriad of different areas so that we can get this ball rolling.” He likened it to a snowball and said, “We’re starting with a snowball and we’re going to end up with a massive avalanche of good, positive changes in our organization. I’m real excited about what we’re doing.”

The January reports show a net loss for the month of more than $273,000 ($273,529), an amount that was nearly $170,000 higher than the loss of just under $104,000 ($103,793) that was budgeted.

Steve Andrews, Vice President of Finance, said the performance was “pretty much volume driven” and added, “Obviously, (we’re) disappointed in our ability to adjust our staffing costs to those volumes.” He indicated that meetings with departments started two weeks ago, “looking at what we need to do to adjust to the volumes.”

Discussion regarding the subject revealed that “dashboards,” similar in concept to what drivers utilize in operating their vehicles, are being developed to provide information to better match staffing with volumes.

Bill Russell, President and CEO at Three Rivers Health, indicated that the hospital is in the process of putting together dashboards and said, “By March 31st, we will have a daily dashboard that will ultimately communicate to the entire workforce in this organization and have meaningful responses on a daily basis.”

Russell said, “What we’ve got to get away from is getting financials two weeks after the close of the previous month where you don’t have an opportunity. That’s retrospective. If it’s a current dashboard, which is the daily dashboard that we’re working on developing now, it’s not retrospective. It’s current. We can react to it on a timely basis.”

Andrews said, “This is not just clinical departments. It’s non-clinical departments as well.” And Russell said, “That’s one of our historical challenges. It’s got to be the entire organization.”

Andrews said, “February inpatient volumes are pretty consistent with January. We are seeing an increase in some of the outpatient, but, if you look at the stats, you can see that outpatient is down as well. So, obviously, (we’re) disappointed there.” However, he indicated that the anticipated loss for February may be less than January because of “other revenue that comes in that’s higher.”

Generally, no comments are offered during this part of the meeting, but that wasn’t the case this time as Rita Lowe, a Three Rivers resident, shared her thoughts with board members and hospital administrators. She began by talking about what she described as “one thing that is really bugging me” – billboards used to market Three Rivers Health. She said, “To me, that is the biggest waste of money. “

Lowe mentioned, in particular, a billboard north of Three Rivers along northbound US-131, just south of Michigan Avenue, that promotes the hospital’s internal medicine practice by referring to “MEDICAL CARE Just for Adults.” She asked, “Is this an R-rated hospital, or X-rated?”

Lowe questioned the need to advertise on billboards, saying, “The basic people that support this hospital are right here in this community.” She suggested “being more community-oriented” and asked, “Why can’t you do something to keep things more oriented to helping the community?” And she suggested holding some board meetings during the evening hours to make it easier for the public to attend.

Lowe said, “Word of mouth is a bigger advertiser than anything and, if you start showing the community that you want to help people, that’s going to get out.”

There was no comment following Lowe’s remarks, but her input was noted later in the meeting during a “board education” presentation on “Lean Six Sigma,” the improvement process launched recently by the hospital recently under the leadership of Alice Mayer, newly-hired as Vice President of Quality & Risk Management.

Regarding the comments by Lowe, Mayer said, “The information she brought us today is gold. We may have had a tendency to say, ‘Okay, on to business now,’ but what she said – we should have really listened because she represents the voice of our customer.” And Mayer said, “If we don’t listen to the voice of our customer, our bottom line, our days in AR, all those things we talked about earlier that are so many indicators are not going to improve.”

During a post-meeting interview, Bill Russell, President & CEO of Three Rivers Health, said he thought Lowe’s comments were “very genuine and very appropriate and, frankly, many of them I agree with.” Russell, who has been on the job since late July last year, said, “One of the things I discovered when I got to town was we use a great deal of outdoor advertising and I, frankly, agree with her that they’re probably not that effective. We are locked into some contractual relationships and, as time goes on, we’re restructuring our relationship with outdoor.”

Russell also commented on the “Just for Adults” billboard. He explained its reference to the internal medicine practice, which is an adult practice without pediatrics, and noted that Three Rivers Health is “a full-service hospital” with “a myriad of physician clinics” and “very happy to extend our services to all age groups.”

Regarding the billboard advertising, Russell said, “I think we’re going to probably step back a little from the outdoor that we’re doing currently.”

The Fair will include presentations, booths, health tips, and free heart-healthy snacks.

Presentations are:

• 9 a.m. – Cardiovascular Disease 101

• 10 a.m. – How do I Exercise my Heart?

• 11 a.m. – Heart Nutrition Tips to Help You

• 12 p.m. – What is Sleep Apnea and How do I Know if I Have it?

• 2 p.m. – Am I Pre-Diabetic?

• 3 p.m. – What You Can’t See Can Hurt You: The Silent Effects of Hypertension 

The Fair is free and open to the public, and features booths representing diabetes, dietary, respiratory/sleep apnea, smoking cessation, hypertension, heart disease, exercise, and cholesterol. Handouts, giveaways, food samples, and recipes will be provided. Visitors can learn techniques to breathe when short of breath. Free blood pressures, free blood oxygen level measurement, and free 10-minute chair massages. Guests can tour the sleep lab, cardiac rehab, pulmonary rehab, and HealthTRAC. Body fat percentage and body mass index checked, and register to win a free massage and other prizes.

If the fair is cancelled due to inclement weather, WLKM – WRCI will be notified, as well as the hospital operator.

Patients are asked to call central scheduling at (269) 273-9699 before 5 p.m. to schedule an appointment for that evening. The Evening Sick Clinic is available on Mondays at the White Pigeon Family Care Office on Kalamazoo Avenue, on Wednesdays at the Centreville Family Care Office across from Village Market, and on Thursdays at the Three Rivers Family Care Office on Sixth Street. Clinic hours are 5 p.m. to 8 p.m. – by appointment only.

All Family Care locations are full-service medical offices with pediatric and adult medical specialists. All offices welcome new patients and take all insurances, including Medicaid and Medicare. For an appointment, just call the central scheduling line at (269) 273-9699.