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Back to black: Hospital making financial turnaround

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By Jeff Moore

Adding new services and enhancing existing ones to meet the community’s health care needs is paying off for Carroll County Memorial Hospital.

The hospital has been operating in the black since the first of 2014, Chief Executive Officer Michael Kozar said in an interview Monday. He credits the new focus on growth in services, along with an increase in the number of patients with health coverage, as the reason the hospital has seen this turn in the tides.

The hospital has added a new digital mammography unit, expanded its MRI and ultra-sound capabilities, hired a general surgeon and added on-site radiology readings one day a week, among other changes in the past year, Kozar said.

With the changes in health coverage that came with the Affordable Care Act, he said the hospital also has 7 percent fewer patients that come without some type of coverage.

“These are some exciting times for this organization,” Kozar said. “We’re seeing unprecedented growth.”

Through April, Kozar said CCMH is about $810,000 ahead of where it was at the same point last year.

The hospital has a net income of $395,163 through April, compared with its budget that projected a loss of $118,417. That’s $513,080 ahead of budget, he said.

At this point last year, the hospital was showing a loss of $414,847.

Kozar said the hospital’s revenue is up by 20 percent, without increasing expenses.

“We’ve grown while keeping our costs flat,” he said.

Kozar is changing the culture at CCMH from one that looks at ways to simply reduce costs, to one that controls expenses while finding ways to grow the business.

“We could not just cut costs,” he said. This new focus on growth has allowed an expansion in services that will prepare the hospital for rocky roads that lie ahead in the healthcare industry.

Working with the members of the hospital’s board of directors, Kozar said the operation has made many changes that have helped with this year’s improved financial picture.

Advancements made in the past year include:

• Implementing the new electronic medical records, required by the federal government under the Affordable Care Act. Kozar said the hospital and its physician practices were successful in making this transition, but continue to work through some of the bugs that come with any new system.

• Contracting with Aetna to provide healthcare services to its enrollees in the area. For years, CCMH was not one of its providers. Kozar said the hospital was able to reach an agreement with Aetna last year, allowing many local residents with that insurance to be able to use hospital services under the medical plans.

• Adding pain management services with Dr. Christopher Nelson coming to Carrollton to assist patients locally.

• Changing radiology providers to a group that now has a radiologist on site one day a week, which will soon increase to two days a week. Kozar said this has allowed patients to have interventional procedures, such as biopsies, at CCMH instead of having to travel to Louisville or Northern Kentucky.

• Installing a new digital mammography unit that improves the quality of images for women who come to CCMH. Kozar said visits for mammograms have increased by between 30 percent and 40 percent.

• Working to help more than 600 people qualify for the expanded medical coverage through the healthcare exchanges set up by the Affordable Care Act. He credits this program with reducing the number of people without coverage coming to the hospital for services.

In December, about 13 percent of people treated at the hospital were self-pay patients. This declined to 6 percent in April because of the coverage people now have through healthcare exchanges under the Affordable Care Act.

Kozar said overall use of the hospital is on the rise.

Compared with last year, he said overall patient registrations — for everything from lab work to overnight stays at CCMH — are up by 15 percent.

Other services are also seeing increases, such as nuclear medicine that is up by 16 percent since 2012. Use of the occupational medicine service grew by 8 percent. He said people are also making use of the expanded telemedicine services allowing patients to receive services by linking them with doctors in Louisville, without having to drive there.

The ripple effect from this has helped the hospital employees.

Kozar said CCMH has been able to provide workers a 3 percent across the board pay increase recently, the first since 2011.

And while the facility has the same cash flow challenges that other hospitals face, he said CCMH has been able to reduce its accounts payable by about $900,000 over the past year. That brought down the total accounts payable from about $1.9 million to around $1 million.

With the foundation the hospital has created in the past year, and other new services and plans that will be coming later this year, Kozar said he believes CCMH is in a much stronger position to weather the tough times that are ahead.

“As sure as I’m sitting here, we’re going to have a downturn,” Kozar said. “Have we put ourselves in a position to weather a downturn? I think we’re in a lot stronger position to weather a downturn than we have been in the past.”

For example, patients will be able to have an electromyogram, or EMG, nerve conduction study at the Carrollton facility instead of traveling to Louisville. Kozar said about 20 people a month were being referred to other facilities for this test.

CCMH, through its affiliation with Norton Healthcare, has been able to bring more specialists to Carrollton, allowing patients to receive services here.

“We’re bringing more specialists to the community, enabling patients to stay here at home,” he said.

Kozar said local residents are the key to the hospital’s continued growth.

“We recognize that patients have a choice,” he said. “When we don’t provide the services, their only choice is to go to Louisville or Northern Kentucky.”

Kozar credits the hard work of the hospital’s board and the support of Carroll County Fiscal Court with making its advances possible.

“We’re very thankful for what fiscal court has done and continues to do for our organization,” he said, noting the hospital is continuing to payoff $100,000 for a loan from the county that kept the facility open after the company operating it pulled out several years ago.

Fiscal court has donated back the past repayments for reinvestment in the facility. Kozar said $50,000 of last year’s county donation, matched with a $50,000 contribution from North American Stainless will go toward relocating physical therapy services into a new location behind Kentucky Utilities.

Kozar also said the hospital staff deserves a lot of credit for its dedication and hard work in recent years to make the growth possible.

“When you can have local people taking care of local patients, it really does resonate good quality care,” he said. “I can honestly say every employee here wants to provide the highest quality of care and do what’s necessary to grow the organization.”

This shows with the results of this year’s state inspection of the facility. Kozar said it turned up no deficiencies, which he said is rare at any hospital.

CCMH also recently received a 100 percent rating on its latest National Healthcare Quality report. The survey looks at how services are provided to patients, he said, speaking to the quality of the organization.

In the past year, the hospital has received 1,546 patient surveys back, receiving a 97 percent approval from those who have used the services. He said that surpassed their target of 95 percent. “We exceeded our goal there,” he said.

Kozar said CCMH is a place people want to work, with many people rejoining the staff.

“We’re seeing people wanting to come work for us,” he said.

The hospital recently sought applicants for a nurse practitioner post, receiving more than 10 resumes. Interestingly, he said, Norton Healthcare was looking for one at the same time and did not get any applications.