GMH one of 32 best in nation
Study of critical access hospitals focuses on financial health.
Ask John Johnson about a recently released report of critical access hospitals and he’ll tell you Gothenburg Memorial Hospital is “the best of the best.”
Of 1,326 hospitals surveyed about five financial indicators, GMH was one of 32 that performed better than benchmark in three years.
Critical access hospitals are certified to receive cost-based reimbursement from Medicare and must meet criteria such as distance from other hospitals and a certain number of acute-care beds.
Financial indicators reviewed in the study include cash flow margin, days of cash on hand, debt service coverage, long-term debt to capitalization and Medicare outpatient cost to charge ratio.
Johnson, GMH administrator, said he looks at what can be done to provide the most care and services to people in the area which, in turn, benefits the hospital.
“They know they are receiving the highest level of care here than anywhere else,” Johnson said.
Outpatient care, provided by visiting specialists, accounts for nearly 70% of the hospital’s revenue, the report said.
“Specialists provide service so people can stay home and not have to travel halfway across the state,” Johnson said.
In addition to offering services needed, such as colonoscopies, CAT scans, digital mammography and more, he said he works to insure local physicians—and those recruited—have the best tools and information to provide better health care.
For example, a $2.9 million doctor’s clinic, now under construction, will help recruit younger doctors to Gothenburg, Johnson noted.
With more than four months of cash on hand (the number of days GMH could operate without income), the administrator said the hospital can replace equipment or use the money for collateral for other things.
Johnson said he agrees with other CEOS of successful hospitals who say the perception of quality of care is a stronger draw for patients than price.
Rather than looking at cost-reduction opportunities, he said he prefers to have high-quality equipment and price services accordingly.
Since he came to GMH 13 years ago, Johnson said the hospital has built up cash and funded four construction projects.
“Our cash position is solid and creates opportunities and the ability to move quickly and fluidly in the decision-making process,” he said, noting that key members of the management team, including assistant administrator Kayleen Dudley, financial director Taci Bartlett and director of quality and risk management Jeanine Kline, have been invaluable in becoming and staying financially sound.
The report, done by the University of North Carolina at Chapel Hill, was funded by the federal office of Rural Health Policy.
Information was collected in most of the categories through 2009.
Hospitals in the study were compared to critical access hospital peer groups and Nebraska and U.S. medians.