Hospital CEO shares hard truths
In a Monday afternoon interview, Wesley Braman, interim chief executive officer at Nevada Regional Medical Center, delivered both sobering and encouraging news related to the hospital and its condition, both at present and for the future.
“These days you’ve got to be a good financial steward of the funds you have,” said Braman. And you have to evaluate how you’re going to spend those funds and make those investments. And that’s even more important today for Nevada Regional Medical Center than it’s ever been in its past.”
Braman spoke about cash reserves, catching up on back bills, letting go of Dr. St. Ville, news on last year’s audit, the current evaluation process, how long it will take for NRMC to get out of the hole it is in, as well as positive things already uncovered.
“The thing that’s been most positive is how welcoming people are here,” said Braman.
As “the boss” he is not surprised to receive smiles and greetings but Braman reported how he has stood off at a distance or around the corner and heard employees express their concern for people’s safety and compassion for their welfare.
The employees “have a true commitment to this community and to the people that come in our doors,” said Braman.
He said some large medical centers have employees who commute a significant distance and where they work is not their home.
“But with the people here, this is their home and it’s their friends, neighbors and family who come through these doors. I admire the people of NRMC; they really do care.”
While at Freeman, at a meeting with the leadership team in charge of the evaluation of NRMC, particular attention was given to Mandi Jordan, director of materials management.
“I heard from several people who said she is very talented, knows what she’s doing and has her ducks in a row,” said Braman.
Even more, Jordan was cited as someone who could clearly learn more, rise to a position of greater responsibility and so make an even greater impact on the whole hospital.
Board member Bob Beaver at the October board meeting asked the outgoing chief financial officer if the hospital was behind on paying any of its bills.
After the meeting, Beaver said of the rambling answer he received, “He didn’t answer my question but I suspect I know what it is.”
Asked this same question Braman said, “Nevada Regional Medical Center is behind on paying some of its bills.”
He cited an example of items needed in order to provide patient care on the medical/surgical floor.
“We were told by a supplier, ‘I’m not going to ship those until you get your account caught up to at least 90 days,’” said Braman.
The interim CEO said he sat down with NRMC’s finance people and asked what accounts currently are or are in danger of incurring penalties for late payment.
“Incurring penalties only makes our financial situation worse,” said Braman.
On Nov. 9, the Long-term Care Unit – Moore Few and Barone Alzheimer Care Centers – transferred $1 million dollars from its reserves to provide needed cash reserves for the hospital. This is equivalent to 8.64 bond cash days.
“This lets us play catch-up and gives us some breathing room,” said Braman.
The review of those late accounts reminded him of how vital it is to review and then ensure that each vendor and contractor is the best possible deal for the hospital. Without being specific, it was clear the interim CEO saw opportunities in this area.
As to the departure of the much heralded orthopedic surgeon, Dr. James St. Ville, Braman said he would provide details to the board but could say several things.
“A new physician is an investment you’re making, a promise for the future,” said Braman.
He spoke of the need to have what he termed “a good action plan.” For Braman, this is both watching the number of patients served and revenue generated on a monthly basis and also on a monthly basis, sharing this information with the physician.
“This way, you ensure the promise and investment comes to fruition,” said Braman. “And if there needs to be a parting of the ways, then there’s no surprise; both parties know what was likely to happen.”
Braman said the pro forma (evaluation) he did for Dr. St. Ville, in which he measured the anticipated costs versus anticipated production and revenues was going to result in a significant loss for the hospital over the next three years.
“Even if he was in Joplin, I’m not sure he could perform the necessary number of procedures to offset the cost of his high guaranteed salary and associated costs, said Braman. “And Nevada isn’t Joplin.”
Dr. St. Ville’s contract was terminated a week ago, prior to performing a single surgery.
When asked about things coming up at next week’s monthly board meeting, his first as interim CEO, Braman mentioned the auditors’ review of the past fiscal year and finance people from Freeman providing a snapshot of the current financial condition of NRMC.
Said Braman, “This is a public hospital and we won’t play games with the finances.”
If there are two things which have been drummed into Braman’s head at Freeman it is the importance of compliance and being a good steward.
“Compliance not only keeps this hospital out of court and out of trouble with those who pay us, but it also includes best practices,” said Braman.
Alongside that, he places good stewardship.
“And by that I not only mean watching all the numbers — and we have to do that and there’s a lot of them to watch — but I also mean stewardship of your people. You have to teach and empower your people. Then, if you ask your leaders enough questions and give them enough options, they will make good decisions on their own.”
Asked about returning to 70 bond cash days he stressed the importance of being realistic.
“In terms of a percent of net revenues, these days the profit margin for a hospital ranges from two to four percent and very few make four percent,” said Braman.
“Even if we could make a million dollar profit a year, it would take us seven to eight years to get back to 70 bond cash days.”
While Braman believes NRMC can be profitable, getting to where the hospital needs to be will take time.
Mindful of the season, Braman said the community, the people who work at NRMC and the patients they get to serve, all have a lot to be thankful for.
“I’m not naïve to the challenges that have occurred here over the last few years or what lies ahead but there’s much more to be thankful for than to be worried about,” said Braman. “We’ve just got to work together to make our way through this process. But we’ll get there. We will get there.”