Needles Hospital Stanching Flow Of Red Ink

NEEDLES—The Colorado River Medical Center’s timely reception of  Medicare money is keeping it afloat, according to Jon Freeberg, the hospitals interim chief administrative officer.
The hospital’s very existence has been threatened by the contracting economy as well as past failures to bill properly and defray the cost of its operation.
While Medicare is the medical center’s economic mainstay, Freeberg said the institution also is making a go of it from the influx of Medi-Cal payments. Money from that state medical program is more sporadic than Medicare payments, he said. Medicare normally pays within 30 days of a claim being filed on behalf of patients eligible for the federal program, Freeberg said. Medi-Cal payments come in within 45 days of a bill being posted, but those billings are subject to greater scrutiny by the state, which routinely disallows payments for some services rendered, Freeberg said.
The hospital is far less efficient in collecting on accounts with self pay patients and those with non-governmental associated medical coverage, according to Freeberg.
The city took on ownership of the Colorado River Medical Center in April 2008 after its previous for-profit owner, Brentwood, Tennessee-based Lifepoint Hospitals, embarked on an effort to move the institution’s equipment and personnel to another hospital it owned in Arizona, roughly 12 miles from Needles.
Because of long-running inadequate billing practices, including failures to invoice Medicare and Medi-Cal as well as insurance companies and patients in a timely fashion, the hospital had consistently lost money, representing a financial liability to the city. The city created a board of trustees to oversee the hospital, and that panel, together with the city council, came to a consensus that spinning the facility off to an independent operator is the best solution for ensuring that the community has adequate medical care without soaking the taxpayers.
In June 2010, Needles voters passed Measure Q, which was intended to keep the hospital’s doors open and absolve the city of the financial burden of subsidizing the facility. Measure Q mandated that a non-profit entity be selected to run the hospital.
The city council in January voted to sell the Colorado River Medical Center and the 5.71 acres it sits upon to Needles Hospital Inc. for $3,587,002. For that amount, Needles Hospital Inc. will purchase most assets and liabilities of the hospital, including accounts receivable, operating inventory in place, outstanding bills and unemployment obligations. Unassumed debts will be deducted from the purchase price but the city is to keep any cash in the hospital’s coffers at the time of sale.
Freeberg said that in the meantime, the hospital is hemorrhaging considerably less red ink than before, as billing and record keeping practices have improved and some grants have been obtained. In briefing the hospital’s board of trustees on April 19, Freeberg noted Medi-Cal recently ratified $274,000 in billing claims by the hospital, another $30,000 will come in from the so-called Disproportionate Hospital Program and the hospital is set to receive an $8,000 grant from the Small Rural Hospital Improvement Program that will be used for upgrades on computers and different radiology equipment.
A renewed effort is being made to collect on aging self-pay accounts and unpaid bills outstanding to insurance carriers. The hospital is currently seeking a full-time lab supervisor, Freeberg said.

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