Schneider CEO argues for $7 million addition to budget

ST. THOMAS - Schneider Hospital officials asked senators Thursday for about $7 million more than the governor's recommended $21.3 million General Fund budget for Fiscal Year 2013.

Hospital officials cited critical needs in information technology, the hemodialysis unit, the community cancer program, salary increases and the Myrah Keating Smith Community Health Center.

Interim Chief Executive Officer Angela Rennalls-Atkinson said she is aware of the economic challenges facing the territory, but the hospital's needs cannot go unfunded.

"The recommended appropriation is insufficient to meet the mandate of operating a cancer center, an acute care hospital and an urgent care clinic on a 24-hour basis. The current heightened challenge that the $21,323,995 level of funding imposes on the organization makes it impossible to render the full scope of services expected by the community and visitors," she said.

Schneider Hospital's budget covers the hospital, the Kimelman Cancer Center and the Myrah Keating Smith Community Health Center on St. John.

Gov. John deJongh Jr. set a budget ceiling for the institution of $21.3 million from the General Fund. The General Fund appropriation covers salaries and benefits for the bulk of the hospital's employees.

In addition to the General Fund, the hospital expects to receive about $62.6 million from non-appropriated funds: $10.4 million from the Health Revolving Fund and $52.1 million from the Hospital Operating Fund. Both funds collect revenue generated by the medical center.

Rennalls-Atkinson said the bare-bones $83.9 million budget proposed for FY 2013 will not be enough to address some key issues.

In addition to the requested budget, she asked senators to fund:

- $2.1 million for information technology infrastructure stabilization and expansion.

- $2 million to sustain the community cancer center program.

- $500,000 to support operations at the Myrah Keating Smith Community Health Center.

- $1.5 million for the hemodialysis program.

- $1 million for recently negotiated salary increases.

Information technology

Electronic health records are a federal and local mandate. Under the federal law, the electronic health records system must be in place by 2014 or the hospital could lose Medicare and Medicaid funding.

Two local laws, Act 7130 and Act 7264, also mandate the implementation of electronic health records and electronic prescriptions by 2015.

Rennalls-Atkinson said compliance is behind schedule because the hospital does not have the money to upgrade necessary hardware and equipment.

"Our medical record system is a hybrid paper and electronic chart which is a major challenge. The infrastructure on which it is based is obsolete, at the end of its useful life and about to crash. A system failure can negate all the advances of the past 10 years if not addressed immediately," she said.

Kimelman Cancer Center

The Kimelman Cancer Center, which serves 1,600 patients, continues to operate at a loss, Rennalls-Atkinson said Thursday. As of June 30, the center's operating loss was almost $2.3 million.

Patient visits rose from 2,514 in FY 2010 to 5,907 in FY 2011, she said.

Rennalls-Atkinson said 49 percent of the center's patients are covered by Medicare and 11 percent are covered by Medicaid. The rising costs of cancer drugs coupled with mandatory federal deductions have whittled the profit margin for treatment to almost nothing, she said.

During the last three years, the cost of one medical oncology treatment has increased from $3,586 to $6,187.

Myrah Keating Smith Community Health Center

The Myrah Keating Smith Community Health Center is the only 24-hour urgent care facility on the island of St. John, Rennalls-Atkinson told senators.

She said the center has operated at a loss of about $500,000 a year since 2007. About 30 percent of patients are uninsured; 8 percent are covered by Medicaid; and 17 percent are covered by Medicare.

Hemodialysis unit

The hospital's hemodialysis unit treats patients suffering from renal failure, and it currently is at capacity and cannot accept any new patients, Rennalls-Atkinson said. Between 2010 and 2011, the number of hemodialysis patients increased 17.6 percent to 94 people. From 2011 to 2012, the number rose to 101 patients.

To address the issue, the hospital received certification for two additional overflow stations, which increased the total number of hemodialysis stations to 18.

"Despite this increase in stations, our resources are still insufficient to meet our ever increasing demands," Rennalls-Atkinson said.

The unit would need about $1.5 million to increase capacity and hire necessary staff, she said.

The hospital is working with outside entities to provide new patients with alternative treatments including home dialysis, according to Rennalls-Atkinson.

The hospital also is continuing its kidney transplant program, Rennalls-Atkinson said. In 2011, three patients received transplants, and 10 patients currently are on a waiting list for a kidney transplant.

Salary increases

Rennalls-Atkinson said the hospital continues to have problems attracting and keeping permanent staff largely because of low salaries; the mandated 8 percent pay cuts; and the inability to pay negotiated salary increases.

From January 2011 to January 2012, 74 employees either retired, resigned or were terminated, Rennalls-Atkinson said.

She said the current registered nurse vacancy rate averages 31.5 percent.

The steady decrease in local funding over the last few years has forced the hospital to dip into its own operating revenues to fund critical positions, she said.

Senators were skeptical about the request to fund past and recent negotiated salary increases because Rennalls-Atkinson could not confirm an amount of what is owed.

- Contact reporter Aldeth Lewin at 714-9111 or email alewin@dailynews.vi.

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