Luis chairwoman: Base V.I. contribution on care, not staff

ST. CROIX - The thing that the 30th Legislature can do to help Luis Hospital the most - short of providing an immediate $10 million cash infusion - is to tie the hospital's annual appropriation to the amount of uncompensated care it provides, a hospital official said.

Luis Hospital board chairwoman Kye Walker delivered her assessment during testimony Wednesday before the Senate Committee on Health, Hospitals, Human Services and Veterans Affairs.

She said that the hospital prefers that the appropriation be based on uncompensated care, rather than on a figure derived from its payroll.

For years, both of the territory's hospitals have been struggling with the increasing burden of uncompensated care - medical care that the facilities provide but for which they do not get paid. The hospitals are required to treat all patients who come through the doors, regardless of their ability to pay.

Previously, the hospital's appropriation would remain with the central government, which processed Luis' payroll and used the money to pay a portion of it. However, at the beginning of Fiscal Year 2012, the hospital started processing its own payroll and now receives its government funding in monthly allotments that are not tied to the payroll.

If the appropriation were tied to the amount of uncompensated care the hospital provides, the move likely would bring more government funding to the hospital.

"That is the No. 1 thing we'd like the Legislature to do for us," Walker told the Senate committee.

Sen. Nereida Rivera-O'Reilly asked for a 10-year analysis of the cost of the hospital's uncompensated care, which officials said they would provide.

Wednesday's Senate committee meeting covered a wide range of topics concerning Luis Hospital, including its financial woes and regulatory compliance issues with the Centers for Medicare and Medicaid Services. Other topics included nurse recruitment, the firing of more than 80 licensed practical nurses and certified nursing assistants a year ago and the cost of energy.

The main testifier for the hospital was cardiologist Dr. Kendall Griffith, who has been interim chief executive officer since the end of January.

Griffith updated senators on a variety of issues with which the hospital has been dealing, including regulatory compliance with CMS.

Griffith said that CMS recently approved two plans of correction that the hospital submitted, one to fix deficiencies that inspectors found during a September 2012 survey and another to fix deficiencies inspectors found during a January survey.

He also spoke about two settlement agreements - which hospital officials call Systems Improvement Agreements - that the hospital is operating under with CMS. One is for the dialysis unit, and the other is for the entire hospital.

The dialysis unit has made major improvements, and the hospital hopes to transition out of using a consultant, Nephrology Services, Inc., into using its own staff - a move that must be approved by CMS, Griffith said.

The hospital currently pays Nephrology Services $30,000 per month, according to Griffith.

As for the hospital-wide settlement agreement, it allows the hospital to continue to receive reimbursements for treating Medicare patients, while a third party monitors and advises on its policies, facilities and patient care until the deficiencies inspectors found are resolved, Griffith said.

Premier is the third-party monitor and is working to help Luis achieve CMS compliance at a cost to the hospital of about $145,000 per month, he said.

The settlement agreement is designed to give the hospital time to make sustainable improvements in "complex quality, cultural, policy and procedural deficiencies, while maintaining funding," Griffith said in his prepared testimony.

He also talked about recruiting more RNs through more competitive salaries, which will save money on more expensive travel nurses. He said the hospital is working on a variety of initiatives to improve quality and safety of care.

Griffith, Walker and Chief Financial Officer Deepak Bansal also spoke about financial challenges the hospital is facing.

Talk turned more than once to the high cost of energy.

Hospital officials said that Luis' V.I. Water and Power Authority bill typically is about $400,000 per month and acknowledged that the hospital owes WAPA about $4 million.

Although the hospital received generators several years ago to generate a portion of its own power more efficiently, at a substantial savings over WAPA power, those generators are not working.

Luis officials obtained the generators through a contract that was designed to pay for the generators through the savings realized in WAPA bills, but the cash-strapped hospital cannot afford the payments it agreed to make, officials said.

While the generators are at the hospital and could function, they are not being used because the hospital cannot afford to pay the contractor or the fuel costs, officials said.

"The generators have gone dormant because of our inability to pay," said Peter Abrahams, vice president of facilities management.

Bansal also noted that some money from a bond issuance the 29th Legislature authorized last year is supposed to be used to make the hospitals more energy-efficient. He said that funding offers a possibility that Luis could go off the WAPA grid altogether.

Other topics discussed included the possibility of merging the territory's hospitals to operate more efficiently, something Gov. John deJongh Jr. made reference to during his State of the Territory Address.

"In theory, I am in favor of both hospitals merging," Walker said. However, any proposed legislation to merge the hospitals would have to contain important clauses to ensure that there is parity between the districts, she said.

- Contact reporter Joy Blackburn at 714-9145 or email jblackburn@dailynews.vi.

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