Cost-cutting helps FCH see a profit

As a result of ongoing cost-cutting measures, Fayette County Hospital recorded another profitable month in July – the first month of the new fiscal year. With revenues of $153,937 and expenses of $117,717, the operation produced a profit of $36,220 for the month.
“The reason we’re making a profit is that we’re controlling expenses,” said Greg Starnes, chief executive officer of the hospital. “We’re a much leaner operation than we were last year, and we’ll stay that way.”
He said that practices such as reducing hours by 5 percent and eliminating several positions have made the turnaround possible.
“Our employees have been asked to make sacrifices, but they still continue to work hard and care like they always have,” Starnes said.
Year-to-date in 2010, the hospital's operator, Heartland Health System Inc., is showing a profit of nearly $671,000 – which is up about $627,000 from the YTD profit through July of 2009, when the total margin through July was only $44,082.
One of the results of the turnaround is that the Heartland has committed to purchase a new CT scanner for FCH – a project that will cost about $355,000.
Starnes said that the unit will be ordered soon, and it should be installed within the next 90 days.
Another major project about to start is the renovation of the hospital’s special care unit. That project will require the SCU to be closed for about 60 days – from Sept. 1 to Nov. 1. When completed, it will allow for more patient room, more privacy and updated equipment.
 As he was presenting information on the SCU project, Jim Lay, chairman of the board’s planning committee, also reported that the hospital’s two boilers may need to be repaired or replaced in the near future.
Lay said that the boilers were being inspected this week, and at least one of the tubes will need to be replaced. The current boilers are the original ones that were installed when the hospital was built in 1953.
“They’re old and not very efficient,” he said.
Mark Ritter, an engineer with Hurst-Rosche Engineering of Hillsboro, told the board that new boilers are 90-percent efficient, while the current boilers are about 70 percent.
“New ones would also save you money because of the controls that are available on them,” Ritter said. He told the board that the cost of the two boilers would be $225,000-$250,000, and that they would have a life expectancy of about 25 years.
Ritter will bring more information about the boilers to the September board meeting.
In the medical staff report, Dr. Michael Darmadi told the board that FCH’s Long Term Care facility scored a 2 out of 5 rating on a recent Star System Report, a federal program that rates nursing homes.
Nancy Pryor, a member of the board, said that a rating of 3 or 4 is good, a 2.5 to 3 is average and a 2 is below average. She noted that the scores have to do with things like the number of infections in the facility and the medication usage.  
Starnes responded: “It’s important for the board to know that we’ve put this before the medical staff. We want to constantly work on how to improve care. It’s important for us to pay close attention to these reports.”
In a matter related to the medical staff, Dr. Brian Dossett was named secretary/treasurer of the staff, replacing Dr. Philip Dy, who has moved from the area.
In his CEO report, Starnes praised the board and Heartland for moving ahead on several projects listed on the hospital’s master facility plan. “It’s a pretty impressive list of things that have been accomplished since the current plan was put together in 2007.”
He said that Heartland will be paying about $20,000 for a consultant to come to the hospital in the near future to do an update on the master plan.
Starnes also reported that recent patient satisfaction scores showed a rating of 90 (of 100) for the emergency room, 87.2 for in-patient and 88.3 for outpatient.