Dear Neighbor,

Thursday night the Board of the Mendocino Coast Hospital voted 5-0 to become a Critical Access Hospital and to retain the ambulance service.

This action followed the Planning Committee's 8-0 vote on Tuesday recommending these actions.

Becoming a Critical Access Hospital promises to add over $1 million to the net revenues of the hospital. It will provide cost-plus-1% reimbursement for all Medicare patients (57% of all billings). This change will make a major contribution to turning around the hospital's financing, but will not be enough in itself.

For many people in the community, the most popular action was the firm commitment to keep the ambulance unless there are major new, unforeseen developments. This ends a long period of uncertainty for the ambulance service, which had been living under a July 1 deadline to set up as an independent operation. Those employed in the service finally know that they will continue to have a job.

Board members Dr. John Kermen and Camille Ranker and ambulance leader Rich Jung, aided by many other devoted ambulance supporters, have been working long and hard to ensure the continuation of a community ambulance. They provide a model for the hospital as a whole on what can be accomplished by a determined commitment to succeed.

At the Board meeting, there was a time when the Board seemed unwilling to commit to keeping the ambulance. Chairperson Charlene McAllister appeared to want to keep open the option of dropping the service. John Kerman, who is developing as a strong voice on the Board, protested this as being contrary to the recommendation of the Planning Committee and unfair to the ambulance workers. He was strongly supported by Jan Hogan, Planning Committee member, and by Camille Ranker and Jim Hay (who heads the Planning Committee). Sensing the Board sentiment, Ms. McAllister finally said, "Okay, we will keep the ambulance service."

Critical Access status will increase ambulance reimbursements by $200,000, bringing the hospital-based service much closer to breakeven. At the meeting, Dr. Kerman and Rich Jung pledged that they would continue to raise funds to ensure that the service will cover all of its costs. This way, the service will not need to fear that the hospital will consider dropping it in any future cost-saving drive.

The Board made clear early on its intention to vote for Critical Access Hospital status, but several hospital employees and one physician expressed concern about the 25-bed limit. The primary concern centered around the probable need to move some patients receiving skilled nursing care to nursing facilities outside of our community, because we don't have enough beds here to meet the need.

Dr. Paul Abramson explained, "The choice is between a 25 bed hospital and a zero bed hospital." Asked to explain a zero bed hospital, he said, "A bankrupt hospital." Most of the audience and all of the board agreed that Critical Access status is needed to avoid bankruptcy. Several emphasized that financial stability would open new possibilities for expansion.

A number of Board members stated emphatically that Critical Access alone would not solve the problem and that a parcel tax would be needed. The Hospital Resource Council believes that this is a premature conclusion. Many areas of hospital operations could be significantly improved, with marked effect on the bottom line. Any consideration of a parcel tax should wait until we see what new management can accomplish.

Our thanks go to all of those who have worked hard to save our hospital. Their efforts are beginning to pay off.

Sincerely,

Vince Taylor
For the Hospital Resource Council