By Martin J. Kidston
by Martin J. Kidston
The Havre Daily News
Tuesday, May 11
Northern Montana Hospitals plans to renovate the Lutheran Home of the Good Sheppard into a 42-room retirement complex have been set aside due to hard times in the health care industry. The change in plans may be indefinite.
Once part of the Hospitals foresight, dubbed Vision 2000, declining Medicare reimbursements have rendered the home financially impossible while placing other medical programs in jeopardy.
Were looking at our entire organization and making staffing and program cuts where necessary, said hospital President and CEO David Henry. We cant cost shift like we used to. Its now based on what Medicare pays us.
Henry said the balanced budget act of 1997, coupled with federal cutbacks, have resulted in the decline of Medicare reimbursements. While hospitals get less from the government, Medicare costs continue to rise and Montanas population ages.
Its a common problem shared by all hospitals across the country, both rural and urban, Henry said. Rural hospitals are looking at loosing five to six percent from their operating budget. Urban hospitals are projected to break even.
Due to the financial strain, the $2 million proposal to renovate the Lutheran Home of the Good Sheppard into a 42-room retirement complex has been put on hold, perhaps indefinitely. The proposed complex would have included housing, food, cleaning services, security and a fitness program, amongst other benefits. The cost for an individual room would have been just under $1,000 month. It was a cost, however, that many couldnt swallow.
The community is very conservative and was cautious on spending that much on rent. Henry said. I wanted that project to work. I bent the numbers and they told me we couldnt make it work. We have backed off the project and we dont know where we go from here. Its on hold.
Henry said they are looking for alternate uses for the building.
Other popular medical programs at Northern Montana Hospital are under review, Henry said, such as the dialysis program and home health care.
Programs like the dialysis serve 12 to 15 patients and cost the hospital money to provide, Henry explained. He said that when the hospital looses money in one program, it puts other programs at risk. Although Henry said the dialysis program is in no immediate jeopardy, reimbursement levels, productivity levels and alternate funding sources will all come into play in considering the programs future.
He said home health care may also be restrained. Though it currently serves approximately 900 people in the Havre area, it may be reduced to 300 people.
Survival is what were up to, Henry said. A number of rural hospitals wont survive. We must try, but we will not look the same as we do today five years down the road.