Financial Information for Eastland Memorial Hospital

Submitted by:
Nancy Stewart, Budget and Finance Committee Member and Secretary of the Board of Directors of Eastland Memorial Hospital District.

Eastland Memorial Hospital was one of five hospitals in Eastland County when it opened in 1953. Other hospitals in the county were:

Rising Star Hospital, Rising Star – closed in 1966;

Blackwell Hospital, Gorman – closed 1971;

Ranger General Hospital, Ranger -closed in 1990;

Graham Memorial Hospital, Cisco – closed in 1990.

Eastland Memorial Hospital is now the only hospital left in Eastland County.  It is not by accident that it is still open and serving the medical needs of our community. This longevity has come from strong conservative direction over many years by the board of directors. Our local hospital faces many challenges, but it is financially strong and is laying a foundation that will enable it to meet the needs of our community well into the future.

Most rural public and even urban public hospitals make up their operating loss from tax revenue received from their taxing district. The Eastland Hospital District is about the size of the Eastland School District. The hospital district draws very little income from property taxes in our district; $426K total in 2020. The average 100K house pays about $88 a year in EMHD taxes. We also receive revenue from a half percent local sales tax in our district which amounted to $540K in 2020. This was a total of about $966K tax revenue for 2020. It cost on average between 45K and 50K a day to keep the hospital open, at this rate the taxes raised for the year keep the hospital open about 19-21 days out of a year. The other 344 days must be funded from hospital operations or other sources. Rural Hospitals tend to struggle as Medicare, Medicaid, and Insurance reimbursements are very low. While larger urban hospitals can better survive on their large volume of patients, it is next to impossible for rural hospitals to break even on hospital operations alone.

And this is compounded in our community by the high percentage of patients we serve that are uninsured (no insurance) or underinsured (have insurance but high deductibles patients are unable to pay). These Self Pay patients have an extremely low rate if any reimbursement at all for services provided by the hospital. The hospital typically has a loss on Hospital operations ranging from $200K to $400K each month.

Under the direction of the current board and administration we have been remarkably successful in finding and participation in supplemental funding programs that shore up this shortfall from operations and sometime even allow us to put some funds back for a rainy day.

These supplemental programs are always short lived, and we face the real possibility of them being cut off at any time. Because of this risk the board tasked our CFO last year to focus on cost cutting measures to shrink our operating loss to a manageable level for when,  not if,   but when these programs end. Every department of the hospital was analyzed for areas we could increase efficiency and reduce wasteful spending.

We cut several departments but the one that has caused the most controversy locally is the Surgery department.  The loss of a significant outside funding program this past year that provided the hospital with a 30 % discount on some of our services; in particular our anesthesia services, ER doctors, Hospitalists, and on call pay for surgeons made this even more of an issue. Our surgery department lost several hundred thousand last year and we were set to lose much more this year if surgery services were continued in the same manner.  Looking at surgery numbers for the past few years we saw that after hours and emergency surgery numbers were very small and we were already successfully transferring these patients to larger facilities when a local surgeon was not available. The decision was made by the board to change our surgery hours to a block schedule of 8 am to 5 pm five days a week. With this schedule the hospital was no longer paying anesthesia for 24/7 coverage at the tune of $450 plus thousand a year when we were not utilizing it in our community, and we are no longer paying nurses for 24/7 on call time as well. This in turn reduced the on call pay to the local surgeon as the time frame for on call was now only 8 am to 5 pm on weekdays.

Another program that loses quite a bit for the hospital is the Emergency Room. We see about 800 patients in the ER every month. Many of the patients that come to the ER are uninsured or underinsured individuals seeking primary care – not emergency care. These individuals come to the ER because they feel they cannot afford to see a Doctor and know they will be treated at the ER regardless of their ability to pay. Eastland Memorial Hospital built (along with several generous donors) a Rural Healthcare Clinic in Eastland called the EMH Regional Healthcare clinic out on HWY 6 by the woodlands and next to the EMH Dialysis center. This Rural Healthcare clinic offers primary care to patients on a sliding payment scale based on income. This will allow patients an affordable option to using the ER which will save the hospital money and will provide them with better care from consistently seeing the same medical professional who is familiar with them and their medical history. The Rural Healthcare clinic will also be open after hours on some weekdays and will have some weekend hours as well to give folks a walk-in style clinic option to use instead of using the ER. EMHD also purchased and keep the Walnut Street Clinic in Ranger open when Dr. Webb retired, and if it is feasible, we hope to open a Rural Healthcare clinic in Cisco as well. Even though Eastland Memorial Hospital District is small we want all of Eastland county to have access to quality, affordable healthcare in our own community.