Santa Paula Hospital Adapts to Stop Financial Losses
Financially ailing Santa Paula Memorial Hospital is targeting Medicare and Medicaid patients and seeking to boost physician referrals in an effrto to stop its mounting operating losses, the Los Angeles Times reports. Built in 1960 solely on community donations, the hospital lost $2.77 million in the last fiscal year, but reserves of only about $4 million. The hospital has reduced the number of beds from 60 to 39, and on a "typical day" only 14 of the beds are filled. Part of the problem rests with reduced reimbursement rates from "miserly HMOs," but larger regional hospitals have also "siphoned off" patients by cutting their rates to attract HMO contracts. To "pump up the bottom line," the hospital has instituted changes to draw more Medicare and Medi-Cal patients to the hospital. Hospital administrators plan to "rally the community" to save the hospital by encouraging local residents to use the hospital "when they need an operation or to deliver their babies." The hospital also plans to work closely with physicians to ensure they refer "every possible patient" to the local facility instead of to Community Memorial Hospital or to Ventura County Medical Center. In addition, the hospital will encourage employers to "insist" that Santa Paula and its physicians be options for company health plans.
Hospital administrators are also offering to file small Medi-Cal payments for doctors electronically, reimbursements that would normally be waived "because of paperwork." Sharron Tiedjens, a consultant working with the hospital, said, "Volume will save us. And that comes from educating the community about our services and being diligent about our relationship with our medical staff." Jim Lott, executive director of the Southern California Health Care Association, said, "It is not written that Santa Paula hospital must close: It can survive. It just depends on whether or not that community can get behind it" (Kelley, Los Angeles Times, 11/27).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.