Executives say they have saved Natividad Medical Center.
The Monterey, Calif. safety net hospital went from a $25 million loss to an $8 million gain in just four years, officials said during a Monday morning session at the Healthcare Financial Management Association's annual ANI conference in Las Vegas.
Natividad executives said the hospital, located south of San Francisco, is the smallest safety net hospital in California.
According to Natividad CEO Harry Weis, public hospitals like Natividad train 43 percent of California's doctors but constitute only 6 percent of the state's hospitals. They also provide care for the majority of the indigent population in the state.
Natividad has been a fixture in the community for more than 100 years, but mismanagement had the hospital very close to closing in 2006.
Since then, Weis said, the hospital has not only recovered, but prospered. He and his team took over the hospital in 2006, instituting team-building changes among staff, setting financial perimeters through data collection, renegotiating contracts with HMOs. Natividad also benefited from a $10 million private donation; 6 million from Salinas Valley Memorial Hospital and 4 million from Community Hospital of Monterey Peninsula that launched the recovery.
"A properly constructed system can be a very powerful growth engine," Weis said of the overhaul. Today the hospital generates $166 million in net revenue, with an annual payroll and benefits of $78 million, and the hospital has added 110 full time employees since 2006. The hospital received more than $20 million in county funding in 2006, he said, but needs no help these days.
Monterey is one of only 10 counties in California to have a safety net hospital.
"We had a myriad of reasons to succeed," Weis said.
According to Weis, part of the recovery was due to changing the culture of the hospital from "what we're doing is good enough" to one focused on pride in performance. Nurses were made key members of the success team. Employees were held accountable for the first time in years. And poor performers were fired, after failed efforts to do so in the past.
In addition, the ER billing department upgraded the hospital's fee scale for the first time in 10 years, matching the prices of services to those of surrounding hospitals, Weis said.
"We want to debunk the myth that public safety net hospitals can never make money," said Jeffrey Bass, MD, who was director of Natividad's emergency room during the turnaround. "We don't think we're a fluke. This is a model that can be reproduced over and over again."
In turning emergency department efficiency around, Bass said, they focused on ways to save money instead of cutting more. Triage was improved so that patients in the ER were treated and sent home if they had low acuity illnesses. This freed up beds for patients with more severe problems, he said.
As a result of the changes, patient wait times went from around four hours to roughly 30 minutes. Patient satisfaction spread by word of mouth and the hospital increased the volume of patients they were able to handle, with fewer leaving before they were treated, he said.