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Bills, reduced income force request

2/1/2013

By MIKE CORN

mcorn@dailynews.net

WaKEENEY -- It was a double-whammy that brought Trego County-Lemke Memorial Hospital to its knees, forcing it to ask the county for a series of steps that would boost the hospital's bottom line.

The financial crunch came to a head last fall when the hospital's Medicare reimbursement rate fell sharply, falling more than $600,000 at a time when cash flow was at its lowest, CEO Harold Courtois said.

That forced the hospital to tap into its $1.1 million reserve, which now stands at approximately $275,000.

"The $275,000 doesn't even cover payroll," said Dave Augustine, the hospital's chief financial officer. "And that happens every two weeks."

"A hospital our size needs a $3 million reserve," Courtois said. "And we're sitting at $275,000."

Courtois said the decision to ask for $1.8 million in no-fund warrants came about because the hospital owed vendors $1.1 million, and auditors had forecast the need for an annual cash infusion of $700,000.

That annual shortfall is nearly identical to the $678,000 loss the hospital incurred in 2012, Courtois said.

Trego County also has approved putting a 1-percent sales tax before voters.

That would bring in approximately $514,000 a year, Courtois said, the vast majority going to the hospital.

"The commissioners have committed $700,000 to us," he said.

That's in addition to the no-fund warrants and would start in 2014, coming from more than $300,000 in property taxes and the rest from the sales tax -- if it passes.

The hospital's also cut nearly $700,000 in expenses, part of that by reducing its workforce.

"We are lean and mean right now," Courtois said. "And trying to get leaner every month."

That's let the hospital make up ground.

"They're a little better," Courtois said of the hospital's financial situation. "They're not good enough where we can catch up on our bills. We're staying even."

Currently, he said, the hospital still owes its vendors approximately $750,000.

"They've been very patient with us," Courtois said.

He's unsure how patient they will be if there's a protest.

"We'd be in deep trouble," Augustine said, noting the hospital sent letters to vendors telling them they were working with the county to get the money to pay its bills.

"We need the help," Courtois said. "It's pretty clear we need the $1.8 million for last year and this year."

He thinks there's plenty of support for the hospital in the community.

"I'm pretty optimistic of the outcome," Courtois said. "I'm just hoping it's not delayed by a vote."