This article by Nora Doyle-Burr first appeared in the Valley News on Nov. 8.
SPRINGFIELD — Despite ongoing concerns about Springfield Hospital’s future sustainability following its exit from Chapter 11 bankruptcy last year, the Green Mountain Care Board on Nov. 8 unanimously approved the hospital’s proposed $55 million budget for the current fiscal year.
The vote was on a revised budget after the board earlier this fall had expressed concerns about the hospital’s ability to meet projections included in the original submission. The budget that regulators approved on Nov. 8 banks on a continuation of the current strong demand for hospital services; an 8.3% rate increase for commercial insurers that the board approved earlier this fall; and an expected increase in reimbursement from Medicare.
Care Board “staff do believe that the trends that Springfield is seeing will continue,” Patrick Rooney, the board’s director of health systems finances, said during the hearing, which was held online. “There is a need in that community right now. They are meeting it.”
Demand for hospital beds across the region has been up in recent months amid the surge of the delta variant of the virus that causes Covid-19 and worsening chronic illnesses due to delays in seeking care earlier in the pandemic.
While Care Board members supported Springfield’s budget on Monday, hospital officials still are required to meet monthly with board chair Kevin Mullin to monitor the hospital’s financial status. Even while they lent their support, board members also expressed some skepticism about Springfield officials’ ability to realize a positive operating margin after several years of losses.
“I remain concerned about this budget,” said Jessica Holmes, a member of the board who is also a professor of economics at Middlebury College.
Hospital officials may be overly optimistic about the continuation of current demand for inpatient care, which may be an anomaly caused by “pent-up demand” from earlier in the Covid-19 pandemic, Holmes said.
Springfield Hospital CEO Robert Adcock told regulators he expects the hospital’s net patient revenue, the amount the hospital receives for health care services, will grow from $46.8 million last fiscal year to $54.7 million this year.
Not included in last year’s net patient revenue was $1.6 million in a state grant that kept the hospital’s 10-bed psychiatric facility, the Windham Center in Bellows Falls, reserved for Covid-19-positive psychiatric patients for much of last fiscal year, limiting the census there.
Adcock said that he’s “optimistic that the (fiscal year) ’22 budget can bring us to breakeven or better.”
In addition to the 10 beds at the Windham Center, the hospital has 25 beds in Springfield.
During the fiscal year that ended Sept. 30, the hospital averaged a daily census of about 10 acute patients, four psychiatric patients and one swing-bed patient, Adcock said. It saw about 11,700 emergency department visits last year, for an average of about 32 per day.
But amid the surge of the delta variant and an increase in demand for hospital services across the region in recent months, volumes have climbed. On the day of the hearing, for example, all 10 beds at the Windham Center were full, Adcock said. There also were 11 acute patients and three in swing beds, which are used as a transition to a long-term care facility. Emergency department visits also have been up lately, with 44 on Nov. 7 alone, he said.
All in all, the increase in volume is expected to add $3.2 million to Springfield’s net patient revenue this year, compared with last.
In addition to the increase in demand for services, hospital officials said they are expecting a $2 million boost from the 8.3% rate increase the board approved, which they expect will increase the amount the hospital collects from commercial insurers. Similarly, hospital officials also said they expect a $2.7 million boost from an increase in the reimbursement they collect from Medicare.
In addition to expressing concerns about the hospital’s projections, Holmes also urged hospital officials to consider how best to provide health care in the future, following a consultant’s report delivered to the board last month that suggested reducing beds at some of the state’s hospitals and rethinking how care is delivered. The report came as part of the state’s push to make hospitals sustainable even as it moves forward with the transition from fee-for-service to fixed payments for keeping people healthy.
One suggestion in the consultant’s report, for example, was shifting inpatient care provided at Springfield Hospital to Mt. Ascutney Hospital and Health Center in Windsor; and converting Springfield Hospital to an alternate acute care delivery model such as a rural emergency hospital, freestanding emergency department, an outpatient hospital or a hospital-at-home service.
Hospital officials said they plan to explore a range of options for how they continue to provide care in the future. The hospital is recruiting a new general surgeon as soon as possible, and may expand care in urology and gynecology, and add a pain management service, Adcock said.
The hospital also is working on a telemedicine effort that would allow Springfield Hospital clinicians to consult with specialists elsewhere as needed. The hospital is also considering how it might begin to offer specialized care for geriatric psychiatric patients. In the longer term, Springfield officials are seeking a formal partnership with a local or regional health care provider.
“We’re rooting for your continued success and for that of your community,” Mullin, the board’s chairman, said following the vote.
