Holy Cross Hospital is in dire financial straits.
It is struggling to meet payroll, laying off staff and postponing payments to vendors.
This is a familiar crisis for the hospital, for Taos and for the surrounding region that depends on the facility for health care.
Is there a way out of this financial roller-coaster the hospital has been on? We believe there is, but it won’t be easy and it will take everyone doing their part, including the community.
Certainly Holy Cross is not the only rural hospital facing cash flow problems. Since 2010, 83 rural hospitals across the United States have closed, according to the University of North Carolina Rural Health Research Program. Most of those are in the eastern half of the country and none in New Mexico, but three have closed in neighboring Arizona and more than a dozen in Texas. It indicates the precarious financial situation for all rural hospitals.
It is not beyond the realm of possibility that Taos could lose its hospital.
Certainly, the administration and staff have been working to make it more financially stable. One could chalk up what happened recently to a string of poorly timed projects and worse luck.
A new Medicare reimbursement model that would pay the hospital more on the dollar for services is taking longer than expected to kick in; then Medicare found a four-year-old overpayment to the hospital and is demanding its money back. Kinks in a new computerized billing system have delayed invoices the hospital could collect on, and there’s been a hefty hike in the hospital’s medical malpractice insurance.
Some things in the months ahead will be beyond the hospital’s control. A high percentage of patients at the hospital rely on Medicare and Medicaid. Funding for those federal programs could get cut dramatically with devastating consequences to Holy Cross.
CEO Bill Patten and the administration are making an effort to be transparent about finances. The most difficult step Patten and the hospital board might have to take to survive in the short run is asking the county to let the hospital use mill levy revenue to pay for salaries and other operating expenses, which voters understood they would not do.
We think the county should approve the request but make it a loan against the mill levy funds, repayable to the mill levy fund managed by the county within a reasonable time frame at low interest.
What else might help the hospital?
– In three years, a .5 percent countywide gross receipts tax used by Taos Public Schools will end. The tax was originally passed to build the hospital and later continued to help the schools. When the tax term ends, it could be continued and used again to help the hospital. Keeping the existing tax in place could generate up to $1 million a year, according to one city councilor.
– Taos Community Foundation, an organization with a stable reputation for managing funds for other nonprofits, could work with Holy Cross to establish an endowment. It already works with the hospital on a First Steps program helping parents of new babies. An endowment managed on Holy Cross’s behalf, but not as part of the medical center, might be the kind of financial arrangement that would encourage people to give generously.
– Annual forum: We recommend Patten and the hospital board host an annual forum at UNM where they outline clearly their health care priorities, their finances, challenges and what the community can do to help. After all, this is the community’s hospital. And more of the community should tune in to the monthly videos the hospital releases on its website following board meetings.
– The Taos community needs to promote individual health. Yes, we’re a poor county and a lot of people rely on Medicaid and Medicare. But exercise benefits most people and, unless you are in a coma or in terrible chronic pain, you can do some kind of daily exercise. The healthier we are as a community, the less often we have to use the hospital and strain its finances.
– To that end, Taos doctors, if they aren’t already doing so, should begin prescribing exercise as part of treatment, not just drugs. More doctors across the nation are doing so. While it seems odd to have to write a prescription, it has proven effective elsewhere in getting patients to take ownership of their health.
Maybe we’re overly optimistic, but we believe Holy Cross, and the communities around our hospital, can survive and thrive.