PMH Audit Shows Improved Financial Health
Marlinton, WV – Pocahontas Memorial Hospital didn’t have a good month, financially, but a year-end audit shows the hospital is making great strides toward financial stability.
Accountant Greg Gibbs, with the Charleston firm Arnett and Foster, summarized the results of the audit for the hospital board. Gibbs says the auditors praised the hospital’s willingness to make changes.
“We had no disagreements with management,” he said. “We felt the audit went well for the year. Our staff was very complimentary. Anytime we come up with a suggestion or a recommendation, everyone was very receptive and said, ‘yes, we’ll do that and we’ll fix that going forward.”
The auditor reviewed a financial report, which indicated the hospital has greatly reduced its deficit during the last two years. The hospital lost more than $713,000 for the year that ended June 30, 2010. In fiscal year 2011, the hospital reduced its deficit to just over $263,000. The report notes that the hospital’s management agreement with the Minnie Hamilton Corporation ended on September 30, 2010.
Following the termination of that agreement, the hospital’s financial health has seen steady improvement. The auditor’s report notes that the hospital did not borrow money from its line of credit during fiscal year 2011. Gibbs says auditors concerns will disappear if the hospital continues its improved fiscal management.
“Even though the hospital’s performance was a lot better this last year, there are concerns about it, going forward,” he said. “We realize that we’re not fully out of the woods, totally, on the balance sheet. We want to build up a lot of cash reserves and stuff like you want to do. But here’s what our plans are – it’s sort of a proactive thing. We realize that we’re still having issues. If you have another year like you had last year, this will go away.
The board voted 6-0 to accept the audit and financial report.
PMH chief financial officer Chad Carpenter tells the board the hospital lost money last month, but not as much as he originally thought.
“The income statement does show a loss of $58, 582 for the month,” he said. “However, after the month was closed, we did discover that there was $26,000 in revenue that should have been charged, but wasn’t, which would have brought our loss down to $32,000.”
Carpenter said the additional revenue would be carried over to December’s financial statement.
The financial officer told the board that an accounting error had been fixed, resulting in a minus $39,000 adjustment to the current year’s revenue.
The monthly financial statement showed a loss of more than $19,000 in November for the hospital’s ambulance service, and a year-to-date loss of nearly $45,000 for the service.
Having an optional paramedic on duty is part of the high cost of the ambulance service to the hospital. PMH CEO Barbara Lay describes an incident at another hospital to highlight the need for paramedics to perform inter-hospital transports.
“We had an internal bleed in the facility for seven hours,” she said. “Bad weather,no paramedic available, Healthnet couldn’t fly and we almost ran out of blood. So, there is a real need and I know there are some of those same horror stories that came from this facility, because we don’t do surgery, we don’t have intensive care. So, it is vital that we do have the ability to do inter-facility transports from the hospital, for the lives of our patients.”
Board member Janet Ghigo says the hospital didn’t have an ambulance service until a county commissioner realized the need.
“I think the thing that probably spurred it the most was when a family member of a county commissioner was here with chest pain and had to wait 13 hours to be transported out.”
Board member Dan Lewis says a paramedic-equipped ambulance is necessary for the hospital to meet basic medical standards.
“This is a recognition of a standard of care, that was not previously met in this county,” he said. “It’s an additional expense that was not accounted for by the county commission or not supported or added to the budget for the hospital. The hospital, now, is providing a correct standard of care.”
The board voted 6-0 to approve the financial statement for November and also approved turning over nearly $112,000 in bad debt to a collection agency.
During the CEO report, Lay informed the board that 22 personnel had attended leadership training in Marlinton. The CEO also showed the board blueprints for upgrades to the hospital’s admission and emergency room areas. The county commission provided $25,000 for the upgrades.
The next regular PMH board meeting is scheduled for January 26. The board will conduct a special meeting on January 4 at 6 p.m. to approve policies related to the Rural Health Clinic audit.