[S]tate regulators have approved a $3.19 million upgrade to MRI services at Northeastern Vermont Regional Hospital, saying the project will improve care without increasing patient costs.
The approval by the Green Mountain Care Board means the St. Johnsbury hospital can proceed with plans to replace its 12-year-old MRI unit, which is currently housed in a trailer on hospital property. The project also will provide for the construction of a new, more permanent home for the hospital’s MRI services.
In a decision dated Monday, care board members said the hospital would not incur new debt to fund the improvements. The board also said the project’s cost “is reasonable in light of its benefits.”
“Replacing this critical piece of equipment with up-to-date technology will increase diagnostic accuracy and reduce the need for patients to travel to other facilities for rescans,” the board’s decision says.
Upgrading MRI facilities is “something we knew we needed to do for a while,” said Bob Hersey, the hospital’s chief financial officer. Care board documents say NVRH has been relying on a machine that was manufactured in 2006 and later refurbished.
The unit “has a number of clinical shortcomings,” care board members wrote. For example, “scans for certain patients are of poor image quality, necessitating referrals of these patients to other facilities for repeat scans.”
The machine also can be uncomfortable for some patients. “The tube is very narrow,” Hersey said. “And because the technology is older, it takes longer for the picture to be taken.”
The new MRI, which comes at a cost of $1.39 million, is expected to provide “superior imagery” and be less susceptible to visual anomalies, care board members said. The unit also will feature “a wide-bore opening to accommodate claustrophobic patients.”
Hospital administrators plan to construct a 1,374-square-foot building designed to provide “a long-term solution for housing MRI services.” The care board’s decision says the reconfigured workspace will create “a more efficient flow of patients, and (the hospital) will have more options for the installation of replacement MRI scanners in the future.”
Construction costs for the building are estimated at $1.8 million.
The new facilities aren’t expected to attract many new patients to NVRH, which primarily serves Caledonia County. An estimated 1,340 scans will be performed at the hospital this fiscal year, with the number expected to rise slightly to 1,375 in fiscal years 2020 and 2021, care board documents say.
Rather than boosting the hospital’s scan numbers, “we were just looking to get better image quality and a better experience for the patients,” Hersey said.
The project also “will not significantly increase the cost of care or impact other services” at Northeastern, care board members said.
“The applicant does not plan to increase charges due to this project, and the average charge for the five highest-volume scans (lumbar spine, brain, brain stem, upper extremity and lower extremity) will remain level through fiscal year 2021,” the board’s decision says.
The hospital is not planning to go into debt to pay for the MRI upgrade. Documents say the project will be “self-financed.” The care board says the hospital allocated a total of $2.1 million for the initiative in its 2016 and 2017 budgets.
The hospital “can sustain the financial burden of the project,” care board members wrote. “Although entirely self-financed, the project will not materially change the applicant’s annual operating margin or other key financial metrics.”
NVRH also has committed to “reviewing opportunities to improve efficiencies” and cut costs in order to save roughly $124,000 or more in the current fiscal year, documents say.
Hospital administrators say their next steps are to work with architects and engineers to make final preparations for the project.
“Our goal is to get the construction started this fall,” Hersey said. “We’re hoping to get it up and running within a year.”
