TOWN HALL: Your questions about the Blackwell Hospital answered

Leaders of Stillwater Medical Center – Blackwell told community members Thursday that securing additional federal funding may be the only way to keep the local hospital open.

“The alternative is to not have a hospital at all,” said Steven Taylor, the hospital’s CEO.

“If you’re running a business, and you’re losing $1 million per year, you can’t do that for a long period of time. Eventually, you have to do something different.”

Taylor and Courtney Kozikuski, the hospital’s CFO, spoke to about two dozen community members at the Blackwell Event Center that evening during a Town Hall style meeting to discuss the hospital’s future and potential service changes.

It was the second community meeting they hosted that day. Hospital leaders announced in January that they intend to apply for a new designation from the Centers for Medicare and Medicaid that would give the facility an additional$267,000 per month on top of reimbursement.

However, if the hospital is redesignated as a rural emergency hospital, it would no longer offer acute inpatient care, though patients could be admitted for observation care.

Hospital officials said they’re applying for the new designation because the hospital has lost roughly $4.7 million since January 2020.

“We’re looking for ways to be more financially viable,” Taylor said.

WHAT THE DESIGNATION WOULD CHANGE

The rural emergency hospital designation was the result of federal legislation passed in 2020, and it went into effectJan. 1.

Hospitals can now apply for the new designation. The new designation would allow the local hospital to keep its emergency room and outpatient services open, Taylor said.

The hospital would no longer be considered an acute inpatient care hospital, but it could keep patients for observation care by a physician.

Under the new designation, the hospital’s average yearly admission time cannot exceed 24 hours per patient, which means that some patients may be under observation care for more or less than that period of time, Taylor said.

“Some patients may only need to be observed by a physician for 12 hours,” Taylor said.

“It may be 36 or 48 hours. It all depends on the patient. … A year is a long time to come up with an average. Now, that’s something obviously we’ll be monitoring on a monthly basis, a weekly basis, to see where we’re at.”

Patients who need acute inpatient care, generally referred to as short-term hospitalization for treatment of injuries and illnesses, or additional observation care would have to be transferred to another facility, Taylor said. “People should still come,” Taylor said.

“We’re going to take care of them as much as we can. If somebody has pneumonia and they’re not improving, sure, we may have to ship them somewhere else. But it’s not like you cannot stay at the hospital.”

FUNDING SHORTFALLS

Rural hospitals across the nation have grappled with low reimbursement from Medicare and insurance providers for years, Taylor said. Hospitals also had to spend more money during the coronavirus pandemic to provide additional care and purchase personal protective equipment, and they’ve faced the costs of pandemic-related inflation.

About 76% of Oklahoma’s hospitals are operating “in the red,” Kozikuski said, as operating costs have risen by about 26% in the past two to three years. The additional funding from the new designation should allow the hospital to remain open, Taylor said.

However, he said he could not make any guarantees, and hospital leaders currently have no “plan B” for keeping the hospital open if the redesignation isn’t approved. “We believe that it will [stay open] as long as the funding continues to come in like they say it is,” he said.

Although the funding comes from the federal government, it’s contingent upon the passage of state Senate Bill 293, which would allow the Oklahoma Healthcare Authority – the state agency responsible for dispensing Medicare and Medicaid funds – to give the money to rural emergency hospitals.

The bill is up for consideration in the state legislative session beginning in February. If the state Legislature approves the bill, hospital officials say they hope the additional funding will arrive shortly thereafter. Other hospitals, including Stillwater Medical Center – Perry, would benefit from it as well, Taylor said. He believes the Legislature will pass the bill, and he encouraged citizens to contact their state legislators to discuss it.

IMPACT ON AMBULANCE SERVICE

While the new designation may allow the hospital to stay open, city leaders say that shutting down inpatient care services could have a negative financial impact on the city’s ambulance service.

During the Jan. 19 City Council meeting, City Manager Jerry Wieland, Fire Chief Cory Hanebrink and other city officials said the new designation likely would mean more patients have to be transferred by ambulance to other hospitals in the region. The increased number of transfers could leave the city without an ambulance nearby for short periods of time, and it could cost the city an additional $500,000 per year in operational expenses, Councilman Robert Husted said during the Council meeting.

Taylor disputed those figures during the Thursday Town Hall meeting, saying the number of transfers cannot be predicted. “I think speculating on what it is going to cost isn’t accurate until we start doing it,” Taylor said. “Based on what we think, there could be 10 transfers per month over and above what there is now based on the patients we currently serve. But one month, it could be five. One month, it could be 10.”

While Taylor and Kozikuski spoke to audience members at the front of the room, Wieland, Hanebrink and Chief of Police Dewayne Wood sat toward the back of the audience and remained silent during most of the meeting. In response to a question from an audience member, Hanebrink said:

“We’ll just be on reacting mode. We don’t know if it’s going to happen. They’re waiting on legislation. They may or may not pass it. Then, we’ll just have to see how many patients are transferred out to determine what the impact will be on the city.”

Taylor also said the hospital does not plan to give the City of Blackwell any of the additional funding it may receive to help offset increased ambulance costs. However, he said the hospital and city leaders could have discussions about the situation.

INSURANCE NEGOTIATIONS

Taylor and audience members also discussed another issue facing the hospital: ongoing negotiations between Stillwater Medical Center and insurance provider Blue Cross & Blue Shield. Stillwater Medical leaders have been negotiating with the insurance company to receive higher reimbursement, but no agreement has been reached yet, Taylor said.

Taylor said other hospitals have been in negotiations with the insurance provider before and reached agreements, and he believes the same will occur here.

He said some hospitals have reached agreements with insurance providers at the eleventh hour. If no agreement is reached, patients would pay out-of-network costs at Stillwater Medical facilities. He said he did not know why the negotiations have taken as long as they have. “We feel like we’re being fair and reasonable,” he said.

ADDITIONAL POINTS

Taylor said the hospital has no plans to lay off staff. However, if the hospital needed to reduce staff numbers in the future, that would likely be done through attrition and leaving open positions unfilled. In response to a question from the audience, he said the hospital is not receiving any funds from the 2019 sales tax extension voters passed to fund the hospital reconstruction, which was completed in 2022. The sales tax is still being collected, and those funds are going to the City of Blackwell to pay off the debt incurred from the project, he said. The sales tax will end in 2046.

Taylor also said the newly remodeled facility will suit the hospital well even if it is redesignated.