Newsletter: It Can’t Happen Here…Can It?

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Fall 2015

Recent headlines:

• “More Rural Kansas Hospitals at Risk of Closing”
• “Sudden Hospital Closure Stuns MA Community”
• “Dallas hospital closes after failing to make payroll”
• “North Carolina hospital unexpectedly closes”
• “Minnesota Hospital to Close”
• “Alabama is losing its rural hospitals”
• “Financial troubles force Nevada hospital to close”
• “Why One-third of Hospitals Will Close by 2020”

There are dozens more stories like these in our files. I’m sure that local citizens, hospital employees, even hospital administrators in the communities where closings occurred believed they were secure…their hospital was safe…”It can’t happen here”.

But collapse did happen, sometimes with devastating consequences:

Pam Renshaw had just crashed her four-wheeler into a bonfire in rural Folkston, Georgia, and her skin was getting seared in the flames. Her boyfriend, Billy Chavis, pulled her away and struggled to dial 911 before driving her to the nearest place he could think of for medical attention: an ambulance station more than 20 miles away. The local public hospital, 9 miles from the crash, had closed six weeks earlier. The ambulances Chavis sought were taking other patients to the next closest hospital. It took two hours before Renshaw, in pain from second- and third-degree burns on almost half her body, was (finally) flown to a hospital in Florida. 1

Portia Gibbs, wife and mother, age 48, was having chest pains. Her husband, Barry, put her in the family car and drove her to Belhaven, NC just 47 miles away. But the hospital in Belhaven was closed, and now the closest emergency room was 75 miles away from their home. A helicopter was requested, but it took an hour or more for it to arrive. “Another ten, fifteen minutes went by and the EMTI came out there and he said, “Barry, we’ve done all we can do. We got her back four or five times and her heart just can’t take it.” She didn’t have the opportunity because Belhaven was closed. 2

Unfortunately these scenarios will be repeated. The NRHA estimates that as many as 283 rural hospitals are vulnerable to closure. 3

• Minorities, the elderly, and low-income people suffer the most when local emergency rooms close. Longer distances to emergency rooms and protracted wait times increase a patient’s likelihood of dying by 5%. 4

• A California study found the odds of inpatient mortality increased by 21% among trauma patients who experienced an increased drive time to their nearest trauma center as a result of a closure.

• The sensitivity analyses showed an even larger effect in the two years immediately following a closure, during which patients with increased drive time had 29% higher odds of inpatient death. 5

• In an urban city if a hospital closes, there’s probably another one within 10 minutes. In a rural community, that’s not true. So the consequences of shutting down are much bigger. 1

In today’s economic climate, operating efficiently is a matter of survival. Since claim processing is the economic life blood of a facility and is highly technical (requiring extensive specialized training) it might be logical to consider outsourcing these functions to enhance efficiency.
Advantages of Outsourcing:

• Experienced billing and coding professionals will be working for you.
• Help Ensure Accurate Reimbursement
• Help provide Better Perspective on Financials
• Assist in Navigating a Constantly Changing Industry
• Help Ensure Billing Compliance
• Help Improve Cash Flow
• Reduce Stress by Producing More Cash

Ask yourself these questions:

1. Are your Days in Accounts Receivable too high? (55 days or more). 3
2. Are your Dollars in Accounts Receivable too high? (17% of Net Revenues). 4
3. Is your Net Collection Rate less than 90%?. 5
4. Are you experiencing an increase in Denied Claims? (more than 4% of gross). 5
5. Or are you simply falling behind in claim processing and need temporary assistance?

“The human tendency is to believe anything that comforts, and deny what discomforts, so that unpleasant truths are ignored.”

- Unknown

If you have any concerns or questions, call or email Donald Tapella
for a FREE consultation (816) 229-4887, ext.111,

For additional information, including a complete listing of our services,
visit the Medical Recovery Services website at: