A good-sized crowd showed up at the Memorial Hospital Board of Trustees meeting earlier this month to hear answers about the board’s plan to affiliate with Salina Regional Health Center (SRHC).
Most attended in response to an ad placed in the Feb. 25 edition of the Reflector-Chronicle posing questions about the proposed affiliation and what that means for Memorial Hospital, its employees and the community.
Board Members Dr. Steve Schwarting, chairman, and Tony Geiger answered the questions posed in the ad, explaining why affiliation is now necessary.
Geiger said the U.S. and State of Kansas are moving toward a new model called Rural Emergency Hospitals.
“Many hospitals will need to change to this model or close their doors, as 76 rural hospitals, or 72 percent of rural hospitals in Kansas are at risk of closure,” Geiger said. “Abilene is not one of those hospitals and we do not want to become one of them.
“Memorial would like to increase services, rather than eliminating them, and affiliation will allow that to happen.”
Besides questions about services offered, others posed in the ad had to do with employee concerns including loss of jobs; loss of KPERS retirement benefits; who controls Memorial Hospital’s budget, assets and property; effects on the community; and allegations that the board was being “secretive,” disclosing little information to patients and the tax paying public.
The board answered the questions in an ad of its own published in the Thursday, March 4 edition. (Online subscribers can see the board’s response at the following link: http://www.abilene-rc.com/eedition/page-a6/page_fb47c75b-27f2-5628-bf81-5cc7f16ef262.html)
Town hall meetings?
Abilene resident Mary Ann Bond grilled the board on its lack of public meetings explaining affiliation plans to Abilene and county residents.
Her concerns include: What happens if the hospital gives up KPERS (Kansas Public Employee Retirement System)? Will Memorial lose revenue that is available to a small hospital that is not available to a larger hospital? Will SRHC take Memorial’s revenue? And other questions.
She told the board it needs to hold town hall meetings before any contract with Salina Regional is signed.
But board members said they have been researching the affiliation issue for years.
“First off, where’s the expertise in the community to tell us about health care other than at the hospital board level?” Schwarting questioned.
Also, holding town hall meetings prior to a contract being signed could potentially “let your cats out of the bag” (contract details) putting Salina Regional at a disadvantage.
The meetings could include a “great deal of detail” that SRHC’s competitors could pick up on, Schwarting said.
“So we’re discussing how we’re going to have town hall meetings. We just haven’t decided how we’re going to do that,” he explained.
Geiger said affiliation talk — not a merger, not a buyout — has been going on the entire 8 years he has served on the MHS board and probably before.
Creating partnerships is imperative for a small hospital to survive, he said, comparing it to agricultural cooperatives that get stronger by having more members.
Geiger told the crowd he appreciates the idea of having town hall meetings, but because SRHC is a private 501(c)3 that means its information is not public. Memorial Hospital, on the other hand, receives some tax funding, which puts it into the public realm.
“That’s why you people are invited to be here today. But we cannot negotiate a contract in the public square. It won’t work,” Geiger said. “You elected us to serve on this board to negotiate. This is a tough one. It’s a big one.”
Geiger explained he has been in Abilene 37 years and he will not sign off any agreement that would be detrimental to his community.
“All the information I’ve gleaned tells me right now this makes sense for the longevity of Memorial Health System,” he added.
Board Member Julie Beswick said she has been listening to the public who call or attend meetings.
Bond said this was the first hospital board meeting she had attended and told the board they need to move their meetings to evenings so more people can attend. She also made the comment that SRCH has been trying to affiliate with Memorial for “20 years.”
“That is not true,” Schwarting replied and said when the subject of affiliation came up it “wasn’t because of Salina Regional.”
Chief Financial Officer Elgin Glanzer said affiliation talk has only been discussed over the last 10 years of so, but when he came to town 26 1/2 years ago, the talk then centered around the Sunflower Health Network, which was a different structure.
Geiger said he is glad Salina Regional is interested in affiliating with Memorial. That means the Abilene hospital is doing things right.
“If they didn’t want to be affiliated with us, we got problems,” Geiger said. “We’ve got a good culture, we’ve got good leadership.”
Board Member Millie Fink remembers attending a rural health symposium 10 years ago or longer where members first heard about the concept of affiliating. At that point, the idea was dismissed because Memorial was doing fine on its own.
“Well, things have changed over time... We are viable at this point, we’re a good fit to go into affiliation,” Fink said. “If we were a failing hospital no one would want us.”
As for Bond’s idea to change meeting times to night, several board members commented they have held night meetings but no members of the public attended, even when they were advertised.
Geiger said if he felt an issue being discussed at a meeting was important he would make an effort to attend, no matter when it was held.
As far as accusations the hospital has been secretive, Memorial CEO Harold Courtois said that until now there hasn’t been much to tell.
“We are just now accumulating all the data to be able to talk about it. This has been a long process,” Courtois said, explaining its taken at least seven or eight months.
As for concerns about employees losing their KPERS retirement, Courtois said an independent group, Gallagher, evaluated the retirement program to decide what would happen to people who retire at age 65.
It found that overall only a small number of employees would be hurt by leaving KPERS, He agreed that people would not get any more out of KPERS, but SRHC does offer employees a 401K.
One employee, Nancy, said she was one of the small percentage of Memorial employees who will be affected negatively by losing KPERS. She has been working at MHS since 1998 and said she will lose $425 a month for the rest of her life. “A 401K is not going to make up for that in the three years I have until I retire,” she said, asking if any type of short-term solution could be reached to help upcoming retirees. She said leaving KPERS is a “slap in the face” to long-term employees who have given the majority of their careers to MHS.
Glanzer said the board and staff knew losing KPERS was going to be the biggest issue which is why they commissioned the independent study; however, they have been trying to “strike a balance that meets everyone’s needs.”
Audience member Doyle Seaman asked if Memorial staff looked into affiliating with any other organizations besides Salina Regional.
Courtois said they had and listed Ascension Via Christi, Centura Health, KU Medical Center (which does not affiliate with critical access hospitals) and HCA Wesley -- “which was not a good fit at all,” Courtois said.
“I’m not going to tell you what these places would do, but it would be less staff right up front, then separating employees into groups that work for other affiliates that don’t actually work in your hospital...” he said.
Schwarting related one group said it would get rid of 15 percent of Memorial’s employees. “We didn’t want that to happen in Abilene,” he said.
Positive for other affiliates
Geiger said SRCH has already partnered with Lindsborg and Concordia hospitals and those facilities report it has been a positive experience. He noted since the affiliation, Concordia’s hospital has rebounded to the point it just broke ground on a new hospital.
“It’s worked in those communities. We’ve talked to their board members. They have smiles on their faces. We’re not going to be the initial experiment boy. It’s already been proven to work for a couple communities,” Geiger said.
Seaman asked if visiting specialists from Manhattan would still be able to see patients at Memorial if it affiliates with Salina.
Courtois said that will not change, “We want to give the people of Abilene more options.”
He also explained the term affiliation means it’s an operational management agreement. Not a takeover, not a buyout, not a merger. “It’s a five-year agreement up front. We can get out after year four if we choose. If we don’t like it, we’ll be out the door at the end of year five,” Courtois said. “That’s why we are keeping all our assets.”
Schwarting added that going into a partnership expecting to fail is a poor way to do business. Going back to the statistic about the percentage of hospitals in danger of closing, he said Memorial does not want to be one of those, but said if profit-loss trends continue the way they have “the day is coming.”