How Rural ME Hospitals Are Tackling Financial Challenges

Rene Letourneau, February 10, 2014

Reimbursement cuts aren't the only challenge rural hospitals face. Recruitment and retention of clinical staff is a perennial issue. But creative leadership and telemedicine are making things better at two small Maine hospitals.

Like most hospital and health system chief financial officers, Randy Clark, CFO at Sebasticook Valley Health in Pittsfield, ME, is concerned about cuts to government reimbursements. SVH has a 25-bed critical access hospital and three primary care offices and is a member of the Eastern Maine Healthcare System.

"I think what we generally struggle with is the proposed or actual cuts we receive from Medicare or MaineCare [formerly Medicaid]," Clark says. "It seems every year we are in some debate about why our reimbursements shouldn't be cut. We are also dealing with the 2% cut from sequestration, which for us has an annual impact of about $225,000. We've had to scurry to figure out what to do to deal with that… There are always either threats or actual cuts to our reimbursements, which complicates things, because we still have to pay our staff, give raises, remain competitive, and employ physicians."

Maine's decision not to expand Medicaid adds to an already difficult reimbursement environment, says Jennifer Goodrich, CFO at Charles A. Dean Memorial Hospital, a 25-bed critical access hospital in Greenville, ME, which is also part of Eastern Maine Healthcare System.

Tight Reimbursements a Major Concern
"Now we are seeing our free care go up and our bad debts go up, and if we had some reimbursements on these patients, it would be helpful," Goodrich says. "The people in our community have a high rate of chronic disease, and we have a high volume of uninsured and underinsured patients. We rely on government payers, and when they threaten to cut rates or make changes to payments, it impacts us greatly."

Rene Letourneau

Rene Letourneau is a contributing writer at HealthLeaders Media.


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